American University — Washington College of Law Intellectual Property Brief www.ipbrief.net

Volume 3 Issue 2 Fall 2011

In this issue:

Capturing Clouds: Intellectual Informal Formalities: The Property Issues Within the Live Government’s Attempt to Find Entertainment Production Process Families for Orphan Works by Brian Knowlton by Mark Tratos

The New Hawaiian Model:The The Russian IPR Problem: Native Hawaiian Cultural Trademark How Accession to the WTO is Movement and the Quest for not the Magical Solution, Rather Intellectual Property Rights to Protect a Step in the Right Direction and Preserve Native Hawaiian Culture by Joshua M. Green by Nina Mantilla Featured Blog Posts and Updates by the Intellectual Property Brief Staff

The American University Intellectual Property Brief is licensed under a Creative Commons Attribution 3.0 United States License. Table of Contents

Capturing Clouds: Intellectual Property Issues Within the Live Entertainment Production Process 8 by Brian Knowlton

The New Hawaiian Model: The Native Hawaiian Cultural Trademark Movement and the Quest for 26 Intellectual Property Rights to Protect and Preserve Native Hawaiian Culture by Nina Mantilla

Informal Formalities: The Government’s Attempt to Find Families for Orphan Works 42 by Mark Tratos

The Russian IPR Problem: How Accession to the WTO is Not the Magical Solution, Rather 57 a Step in the Right Direction by Joshua M. Green

2 Fall 2011 Featured Posts

Largest Copyright Infringement in History: Five US Universities Sued for Copyright Infringement by Alexandra Mackey-Authors from Australia, Britain, and Canada are claiming copyright infringement against five US universities for supporting digital libraries without authorization from the authors or publishers. Top 1% Files for Trademark of “Occupy Wall Street” 66 by Seth Dennis-Spurred by the trademark application for OCCUPY WALL ST, two applications have recently been filed for OCCUPY WALL STREET. While one of the applications belongs to OWS organizers, the other application seems to trace back to a likely Remitting the Remittal of Joel member of the 1%. Tenenbaum’s Remittitur Motion by Jess Robinson-The First Circuit reinstated Joel Tenenbaum’s $675,000 debt to Sony for 67 having infringed upon Sony’s copyrighted music, but all may not be what it seems. In its opinion, the First Circuit didn’t overturn the district court’s reasoning but only said it was premature. Can anything be inferred from this? To Patent or Not To Patent, That is The Question: Embryonic Stem 68 Cell Patents Rejected in Europe by Amer Raja-The European Court of Justice was asked to determine the patentability of stem-cell products derived from human embryos. In doing so, they made some highly controversial decisions that may force European scientists to get creative when protecting their research. 70

American University Intellectual Property Brief 3 2011-2012 Staff

Editor-in-Chief Eric Perrott Senior Managing Editor Senior Articles Editor Ashlee Hodge Mark Tratos Copyright Section Editor Patent Section Editor Trademark Section Editor Jim Hill Greg Lultschik Nina Mantilla Senior Symposium Chair Senior Events Chair Ali Sternburg Rachel Gordon Senior Marketing Manager Senior Web Editor James Conlon Peter Bodri Blog Editor Blog Editor Blog Editor Griffin Barnett Aaron Gleaton Ashley Kobi

Senior Staff Sofia Castillo Sarah Leggin Jess Robinson Seth Dennis Alexandra Mackey Ashley Rose Brian Dudley Joe Massie Brenda Sackman JJ Gottschalk Christopher McDonough Liz Shen Caroline Gousse Richard Patterson Jonathan Stroud Jessica Jones Amanda Patton Hasan Tbeileh Jeff Kettle Stephen Price Sarah Zucco Amer Raja

Junior Staff Sean Braun TJ Johnson Greg Meditz Kate Collins Sitara Kadalbal Greg Melus Alexander Dowd John Langlois Ji "Jean" Ryu Dang "Stephen" Huh Brandon Marsh Corsica Smith Daniel Jang Thomas Snyder

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4 Fall 2011 Symposium

American University Intellectual Property Brief Symposium Empowering Users/Creators to Take Control of Their Intellectual Property APRIL 16, 2012 - 9:00 am – 5:00 pm Recently, traditional intellectual property schemes have been shifting due to the rise of new technologies. In the past, the distinction between users and creators was clear, but now the line is becoming blurred. Newspapers, printed research materials, and DVDs are giving way to new media, such as blogs, Wikipedia, and streaming video, which do not coexist peacefully with traditional methods of protecting intellectual property. Digital distribution and the flourishing of amateur creators with less commercial incentive has led to efforts such as Creative Commons and other new and more open models. Join artists, innovators, practitioners, academics and policy makers as we discuss how the traditional forms of intellectual property are adapting to new technologies and methods of communication.

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American University Intellectual Property Brief 7 Capturing Clouds: Intellectual Property Issues Within the Live Entertainment Production Process by Brian Knowlton* Illustrations by Patrick Thomas

I. Introduction elevated to a level of articulating raw ideas; weaving and “It is not once nor twice but times without untangling complex systems of process; communicating number that the same ideas make their through forms and structures that could not otherwise appearance in the world.” be expressed and; reconciling his humanity through 1 ~ Aristotle ~ the craft of organizing sound. Suicidal but with a life sustaining regard for his gift, Beethoven had the Ludwig Van Beethoven. There is perhaps no other audacity to change western culture, not only through artist, certainly no other musician, whose name is music but also with ideas, expression of ideas, and more synonymous with creative daring. Over one hundred and eighty years after his death, his life * Brian Knowlton is a Senior Production Manager at struggle continues to reverberate through western SeaWorld Parks and Entertainment and 2012 J.D. Candidate at St. culture. Best known for having lost his hearing during Mary’s School of Law. He has produced over 100 shows and events, has performed as a symphonic recording artist in multiple cities the pinnacle of his career, Beethoven accomplished the and with the Emmy and Tony award-winning Broadway musical artistic impossible: creating significant musical works “Blast!,” is the recipient of multiple International Association of while lacking the most basic of musical sensibilities. Amusement Parks and Attractions Big “E” awards, and has served as Creative Director of a non-profit music education organization. For Beethoven, composition ceased being a mere The author can be reached at [email protected]. form of esthetic expression and his skill and artistry 1. Mark Evan Bonds, After Beethoven: Imperatives of Originality in the Symphony 9-27 (Harvard Univ. Press 1996).

8 Fall 2011 his recognizable public personality: the quintessential detract from his stature as an artist? If Beethoven tortured artist who brought wisdom and joy to the needed to copy to produce musical works, what does world.2 that mean for the rest of us? How does this change our But even Beethoven copied. Even he stole the approach to using another’s ideas, copying another’s compositional processes of other artists. work or imitating how these works are presented to There is an innate human sense that one’s original the public? “Therein lays the rub.”4 Copying is a idea, unique expression of an idea, belongs to them reality of most pure artistic creation. From this it is and that others should not assume compensation or no surprise that copying is pervasive at other levels acclaim for work that is not their own. It feels right. of artistic creation and, in particular, today’s world And, on first pass, knowing that Beethoven copied of fast-paced and demanding commercial art. There and stole somehow feels wrong. Of course, the sound is no area where these commercial artistic disciplines of a Beethoven symphony only vaguely resembles intersect in greater number and variety than today’s that of one composed by Mozart, but Beethoven’s live events and entertainment productions and thus, 1st Symphony copied the harmonic structure and there is no territory more fertile for the infringement of compositional process of his predecessor’s Jupiter trademarks, trade secrets and copyrights. The purpose Symphony.3 of this article is to explore such intellectual property Why would such a prolific and culture-changing issues as they arise in the production of such events. composer need to copy from other composers? Does II. Defining the Scope Beethoven’s borrowing and Mozart’s influence somehow “Think left and think right and think low and think high. Oh, the thinks you can think up if 2. See Lewis Lockwood, Beethoven: the Music and the Life (W. W. Norton and Co. 2003) (In a letter from Ludwig only you try!” Van Beethoven to his brothers Carl and Johann known as the ~ Dr. Seuss ~ Heiligenstadt Testament, Beethoven writes, “ . . . I would have ended my life -- it was only my art that held me back. Ah, it seemed At a time when a large part of daily entertainment to me impossible to leave the world until I had brought forth all is experienced virtually, either through movies, the that I felt was within me.”); see also Nicholas Cook, Beethoven: internet, television or mobile devices, audiences seek Symphony No. 9 (Cambridge Music Handbooks 1993). 3. See Carl Schachter, Mozart’s Last and Beethoven’s an escape from this virtual reality to the actual-reality First: Echoes of K. 551 in the First Movement of Opus 21 of live entertainment. However, they also bring 227 (Cliff Eisen ed., Oxford: Clarendon Press 1991) (“[A] close with them the expectation that live experiences will study of the first movements reveals an intriguing similarity in the tonal plans of their development sections. The similar feature is a rather unusual modulatory progression . . .”). 4. William Shakespeare, Hamlet Act 3. Scene 1.

American University Intellectual Property Brief 9 Capturing Clouds provide the same pacing, perfection and emersion as the protection and safe use of intellectual property its virtual counterpart. Consumer demand for high- and discusses how they operate within the production end experiences is not only met by large-scaled shows process. and events in major cities, but also by smaller tier II. Overview of the Production Process production companies such as theme parks, cruise lines, community theaters, resorts, a variety of independent “There are two ways of being creative. One production companies, and other regional tourist can sing and dance. Or one can create an destinations. environment in which singers and dancers As the quality of these live events increases to meet flourish.” ~ Warren G. Bennis ~ the growing expectations of perfection and complete emersion, a gap between the business practices behind A general approach to the process of producing live the productions and the legal protections of intellectual entertainment and events can be divided into five parts, property rights becomes increasingly apparent. idea generation, concept development, production, Whereas large revenue streams in New York, Las Vegas, rehearsals and performance. Although every project is and Hollywood allow businesses to carefully avoid unique, they all progress through the same five stages. infringement of intellectual property, producers with A. Idea Generation smaller budgets are often driven to use less expensive alternatives for certain types of production elements. As its name suggests, the idea generation Creatively using pre-recorded audio tracks and stock phase occurs when the creative concepts behind imagery, leveraging already popularized show-styles, the production are distilled. The process involves adapting pre-existing content, and cross-utilizing narrowing, focusing, and defining the parameters of up-and-coming design talent often causes unique each idea. To create a solution that meets a business intellectual property issues. In many ways, constrained need (“high-concept”), one must first understand budgets and repurposing ideas result in highly creative that need. Market demands, fiscal objectives, and solutions, for true creativity is not the result of limitless capital investment goals of a project all play into this resources, but manifests as solutions created by need calculation. Next, a creative team is assembled (they and constraint. Although these smaller productions are frequently contracted as expert consultants from frequently produce bright and original ideas, they diverse disciplines) and the producer presents her often do so through the use of the intellectual property objectives and leads the team in brainstorming feasible of others. They lack the resources and established ideas. This can happen through formalized creative business practices to routinely avoid infringing on development meetings or informal conversations, other’s intellectual property, or even to properly protect within or between different business entities, in a their own intellectual property rights. So far these defined amount of meeting time or over a period of infringements have flown below the radar relative to years, and with strategic objectives or a general sense the use of intellectual property in major Hollywood of goal. The culmination of the idea generation phase Blockbusters, Broadway Musicals and Las Vegas Shows. is an executive presentation, bid to a client or proposal The scope of this article is directed towards this for investors and in any case, is used to secure the smaller tier of production, and although it will only final financial endorsement for the project. Regardless provide a cursory review of the law that protects of how this phase is structured, it results in a high- intellectual property and a general overview of the concept, which is a solution to a business problem and process followed to create these live events, it is aimed realized through interactions between people. precisely at those points where the law and production B. Concept Development process intersect. It aims to give a producer a more The concept development phase of the production thorough understanding of intellectual property rights process is comprised of developing plans for the various and attorneys a clearer understanding of the business creative elements that will ultimately become a part of practices and needs of this unique demographic of the live show: script, scenic, music, video, costumes, clientele. It first gives an overview of the production lighting, and special effects. The producer hires process and provides a summary of current intellectual designers through either an employee or contracted property law. After exploring practical examples, it relationship, the latter of which sometimes subcontract reviews the various legal instruments available to ensure

10 Fall 2011 Brian Knowlton

and/or hires employees to meet objectives. The D. Rehearsals producer also hires a show director who interfaces Once rehearsals begin, entities and individuals with designers and not only ensures that each designer from the production phase begin to complete their is creating work that supports the high-concept, but work, the producer hires cast members and the director also ensures that the diverse disciplines work together and her various assistants (choreographer, lighting with coherence. The work-products that result from designer, stunt coordinator, and effects coordinator) this phase include scripts, illustrations, music ‘scratch- rehearse with performers and other live-action tracks’, storyboards, costume designs, architectural components of the show. Individually, these assistants drawings, engineering documents, sketches, and interact within the scope of their specialty, but are lighting plots. The concept development phase creates frequently present during major on-the-spot decisions. documents and plans that will be used to fabricate Performers are consulted by the director when making items that will ultimately be used in the show. creative decisions regarding the reality of whether C. Production a staging idea is possible, on-going performance It is in the production phase that the actual challenges, and other content-based issues. tangible elements for the show are created: scripts are E. Performance printed; sets and costumes are built; music is recorded; Finally, the concept becomes a reality and it is video is filmed, animated, and edited; special effects time for performance[s]. At this point, the design are designed and constructed; lights are hung; and team steps away from the production and a group of performing talent is cast. In addition to the designers stage managers and other operational personnel run from the concept development phase who oversee the the show. A live show can run anywhere from a single production of their elements, various other entities are event to decades of continuous performances. The brought on-board: scenic companies; music studios maintenance of a multi-run show can be contracted and recording artists; video production teams; costume with entities and individuals who are entirely new shops; electricians; stage managers; and stage crew. to the production. Creative changes can occur for a Each of these entities or individuals can be employed, variety of business reasons, each with the capacity to contracted or sub-contracted. include new ideas, directors and designers.

American University Intellectual Property Brief 11 Capturing Clouds

III. Overview of Intellectual Property Rights they are compensated for their ideas or works and what “No man acquires property without acquiring if their intellectual property is infringed upon? with it a little arithmetic also.” Amongst the powers enumerated to Congress in ~ Ralph Waldo Emerson ~ the United States Constitution is the authority “To regulate Commerce” and “To promote the Progress of . Those from whom Beethoven borrowed would . . useful Arts, by securing for limited Times to Authors have understood his copying. Mozart copied from . . . the exclusive Right to their . . . writings . . . .”7 The maestro Franz Haydn, who copied from Johann bundle of intellectual property rights with which the Sebastian Bach, and Bach copied from a generation live entertainment production process most directly 5 of Baroque composers. These masters understood interacts includes the laws of trademark, copyright and that originality is developed through experience, and trade secrets. These protections grant private property experience is merely interaction with what already rights of intellectual assets in order to encourage artistic exists. It is then no surprise that the world is full expression and promote economic growth.8 This of influence, borrowing and the outright wholesale section will give a broad overview of these doctrines, misappropriation of ideas. “Imitation contains a the general concepts of which will be discussed in more complex interplay of impulses: among these, in detail later, when applied to issues that arise during the varying degrees, are the desire to learn, rivalry, and production process. homage.”6 During a time when renowned composers lived with and were supported by aristocratic families, A. Trademark perhaps rising to a level of influence that resulted in Trademark law protects the marketplace by others borrowing ideas was of benefit to a composer’s restricting unauthorized use of marks associated with status, a status that determined the quality of particular manufacturers in a manner that causes their philanthropically-supported lifestyle. Today, confusion as to the source of the goods.9 For example, however, artists are rewarded through direct financial a business cannot name a beverage “Coco-Cola” in an compensation and generally do not benefit from the attempt to leverage the brand of “Coca-Cola.” Trade borrowing of others. So then, how does one ensure “marks” can be words, phrases, logos and symbols

5. See Jeremy Yudkin, Beethoven’s “Mozart” Quartet, 45 J. of the Am. Musicological Soc’y 30, 34 (1992) (“[W]hat a 7. U.S. Const. art. I, § 8, cl. 8; Paul Goldstein, composer looked for in another’s work was usually not material Copyright, Patent, Trademark and Related Doctrines 1 itself, but ways of approaching the material, rhetorical strategies, (Robert C. Clark 4th ed., Foundation Press 1999). ideas of span, control, expression, and coherence.” “Mozart’s 8. See id. at 6. String Quartet, K. 464, is one of the “Haydn” quartets, written as a 9. Arthur R. Miller & Michael H. Davis, Intellectual deliberate homage to the older master.”). Property: Patents, Trademarks, and Copyrights In a 6. Id. at 32. Nutshell 238-55 (West 1983).

12 Fall 2011 Brian Knowlton

used to identify goods.10 Trademarks are distinct from To own a trademark, a party need merely use copyright and trade secrets because trademarks do not a mark in commerce to identify and distinguish a depend on novelty, invention, discovery, or any other product or service.15 Registration is evidence of the intellectual creation; rather, the strength of a mark registrant’s right to use the mark in commerce.16 depends on the type of mark and impression of the Ownership of an incontestable mark gives the registrant consumer11. almost exclusive rights to use the mark.17 A trademark claim turns on the perception of the Trademark infringement occurs when there is a mark in the marketplace. The validity and strength of likelihood of confusion among the relevant class of a mark is analyzed by whether it is fanciful, arbitrary, customers with regard to a trademark.18 Courts may suggestive, descriptive, or generic.12 All marks are consider the following non-exhaustive list of factors considered inherently distinctive and protectable except to determine if infringement occurred: (1) the type for descriptive marks, which are protectable upon of mark allegedly infringed upon, (2) the similarity showing a secondary meaning, and generic marks, between the two marks, (3) the similarity of the which are never protectable.13 A mark is inherently products or services, (4) the identity of the retail outlets distinctive when it is capable of identifying a product and purchasers, (5) the identity of the advertising source; secondary meaning exists only when consumers media used, (6) the defendant’s intent, and (7) any associate a mark with a single market source.14 Thus, a evidence of actual confusion.19 showing of secondary meaning places a greater burden Absent a showing of a likelihood of confusion, on a plaintiff because it is not assumed that consumers a party may enjoin an act that is likely to dilute a associate a descriptive mark with a specific product. distinctive quality of a registered mark.20 The party is

15. 15 U.S.C.A. § 1127 (2006). 16. 15 U.S.C.A. § 1115(a) (2002); Soweco, Inc. v. Shell Oil Co., 617 F.2d at 1184; 15 U.S.C.A. § 1065 (2010). 17. Pebble Beach Co. v. Tour 18, I Ltd., 155 F.3d 526, n.4 10. See id. (5th Cir. 1998). 11. See id. 18. See id. at 543; 15 U.S.C.A. §§ 1114(1), 1125(a). 12. Abercrombie & Fitch Co. v. Hunting World, Inc., 537 19. Two Pesos, Inc. v. Taco Cabana, Inc, 932 F.2d 1113, 1122 F.2d 4, 9 (2nd Cir. 1976). n.9 (5th Cir. 1991); Conan Properties, Inc. v. Conans Pizza, Inc., 13. Sicilia Di R. Biebow & Co. v. Cox, 732 F.2d 417, 425 752 F.2d 145, 149 (5th Cir. 1985). (5th Cir. 1984). 20. Tex. Bus & Com. Code Ann. § 16.29 (2011); Service 14. Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 Merchandise Co. v. Service Jewelry Stores, Inc., 737 F. Supp.983, (1992). 993 (S.D.Tex. 1990).

American University Intellectual Property Brief 13 Capturing Clouds able to do this because of anti-dilution statutes. The, source, identity or sponsorship of the product.28 “[p]urpose of an anti-dilution statute is to prevent B. Copyright the gradual ‘whittling away’ of a party’s distinctive trademark or trade name and a plaintiff must The purpose of copyright law is to promote demonstrate ownership of a distinctive mark and a creativity by balancing the benefits of encouraging likelihood of dilution.”21 A mark can be diluted by creation with the costs of restricting access and use 29 tarnishment or blurring.22 A mark is tarnished when it in order to protect authorship. Copyrights can be is “linked to products of shoddy quality” and blurred obtained for literary works, musical works, dramatic when “customers . . . see the plaintiff’s mark used on a works, pantomime and chorography, pictorial works, plethora of different goods.”23 graphic and sculptural works, motion picture and An infringing party can limit its risk of liability by other audio-visual works, architectural works, and 30 using defenses pertaining to the limited area of use, the sound recordings. The principals of copyright are abandonment of a mark, the genericness of a mark, the distinguished from trademark and trade secret law functionality of a product, or the fair use of a mark. A in that copyright owners hold the exclusive right to limited area defense confers upon a user of the mark reproduce works, prepare derivative works, distribute the right to the use of an otherwise infringing mark in copies of works, and perform or display works 31 a remote geographic area if a good faith continuous use publicly. without notice of infringement was established before Copyrighted subject matter must be an original 32 the plaintiff’s use or registration; under this doctrine, work of authorship fixed in any tangible medium. the other user can not typically expand geographically.24 The requirement for originality is independent 33 A plaintiff is found to have abandoned a mark through creation plus a modicum of creativity. An author non-use or not policing licenses.25 Genericness is is an entity “to whom anything owes its origin” and determined by whether or not the mark is understood a work is considered fixed when “its embodiment . . by the relevant public to refer to a particular good.26 A . is sufficiently permanent or stable to permit it to be functionality defense alleges that a mark is attempting perceived, reproduced, or otherwise communicated 34 to control a product feature, considered functional, for a period of more than transitory duration.” A where such use would put competitors at a non- work must be a tangible expression of an idea. Because reputation-related disadvantage; courts look to whether copyright protection never extends to “an idea, process, the questioned functionality is (1) essential to the method of operation or concept,” the more ways an use or purpose or (2) affects the cost or quality of the idea can be expressed, the greater chance it has of article.27 Unauthorized use of another’s mark may be being held to be an expression and not merely an un- 35 fair-use if it is for the purpose of describing one’s goods protectable idea. A derivative work “based upon or services, or to compare advertisements; a fair use one or more preexisting works, such as a translation, defense requires that there is not a misrepresentation 28. Calvin Klein Cosmetics Corp. v. Lenox Laboratories, Inc., or likelihood that consumers will be confused as to the 815 F.2d 500, 503 (8th Cir. 1987); G.D. Searle & Co. v. Hudson Pharm. Corp., 715 F.2d 837, 841 (3d Cir. 1983); Hypertherm, 21. Pebble Beach, 155 F.3d at 550; Fruit of the Loom, Inc. Inc. v. Precision Products, Inc., 832 F.2d 697, 700 (1st Cir. 1987); v. Girouard, 994 F.2d 1359, 1363 (9th Cir. 1993); Hormel Foods Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 791 Corp. v. Jim Henson Productions, Inc., 73 F.3d 497, 506 (2d Cir. (5th Cir. 1983). 1996). 29. Goldstein, supra note 25, at 556-58; Ralph S. Brown 22. Deere & Co. v. MTD Prod., Inc., 41 F.3d 39, 43 (2d Cir. & Robert C. Denicola, Copyright 9-10 (Robert C. Clark ed., 1994); Hormel Foods, 73 F.3d at 506, 507. Foundation Press 2009). 23. See id. 30. 17 U.S.C.A. § 101 (2010); H. Clark Anawalt, Ideas in 24. 15 U.S.C.A. § 1115(b)(5) (2002); Hanover Star Milling the Workplace 15-23 (Caroline Academic Press 1988). Co. v. Metcalf, 240 U.S. 403, 415 (1916); see United Drug Co. v. 31. 17 U.S.C.A. § 101 (2010). Theodore Rectanus Co., 248 U.S. 90 (1918). 32. 17 U.S.C.A. § 102(a) (2011). 25. Paul Goldstein, Copyright, Patent, Trademark and 33. Feist Publications v. Rural Telephone Service Co., 499 Related Doctrines 235-37 (Foundation Press, Robert C. Clark U.S. 340 (1991); Waldman Publ’g Corp. v. Landoll, Inc., 443 F.3d 4th ed. 1999). 775 (2d Cir. 1995). 26. 15 U.S.C.A. § 1052(e)(1); H. Marvin Ginn Corp. v. Int’l 34. Feist Publications, 499 U.S. at 340; Burrow-Giles Ass’n of Fire Chiefs, Inc., 782 F.2d 987 (Fed. Cir. 1986). Lithographic Co. v. Sarony, 111 U.S. 53 (1884) (internal quotations 27. Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 omitted); 17 U.S.C.A. § 101. U.S. 844, 851 n.10 (1982); Qualitex Co. v. Jacobsen Products Co., 35. 17 U.S.C.A. § 102; Baker v. Selden, 101 U.S. 99 (1879); Inc., 514 U.S. 159 (1995). Mazer v. Stein, 347 U.S. 201, 217 (1954).

14 Fall 2011 Brian Knowlton

musical arrangement, dramatization, fictionalization, structure of the work.39 Melodies (even melodies motion picture version, sound recording, [or] art suggestive of prior works) and counter-melodies can reproduction” is considered to be an original work of rise to meet the creativity threshold while only some authorship, but the copyright in the derivative work courts recognize creativity in harmony and rhythmic only covers the new elements and not the original creativity is legally impossible; “fingerings, dynamics expression on which the work was based.36 marks, tempo indications, slurs, and phrasing” do meet The various types of subject matter protected under the standard of creativity.40 the Copyright Act are treated differently and thus a To be considered an author of a sound recording more in-depth understanding of each is necessary. (and thus a copyright holder), one needs to have made Musical works not only include musical notation, but an original contribution. A producer of a sound also “any accompanying words.”37 However, because recording (who likely does not make an original one can copyright a musical work by merely recording contribution) is the owner of a copyright if they obtain it (without notating it in tablature), ownership of lyrics an express written and signed transfer or assignment may not vest as they would have through the process from the performing artists, recording engineer, and of notated composition. The lyrics may therefore be employees of the music production company. Transfers considered a literary work as well, in which case both can be recorded with the Copyright Office to ensure the composer and lyricist receive an undivided fifty- ownership.41 percent interest in the copyrighted musical work.38 Copyrighted dramatic works must relate to a Although a musical arrangement may be a derivative story as well as depict a story (through accompanying work from the original composition and deserving of a music, dialogue and/or action) independent from copyright regardless of the authorship of the underlying narration, and “any dramatic work other than a work, the arranged work must meet the requirement pantomime is also a literary work.”42 “Exhibitions, of originality and not merely re-arrange the form and 39. Id. § 2.05[C] and [D]; Anheuser-Busch, Inc. v. Elsmere Music, Inc., 633 F. Supp. 487 (S.D.N.Y. 1986). 40. Nimmer, § 2.05[D]; Bridgeport Music, Inc. v. UMG 36. 17 U.S.C.A. § 101 (2010). Recordings, Inc., 585 F.3d 267, 272 n.1 (6th Cir. 2009) (Treatise 37. Melville Nimmer, Nimmer on Copyright § 2.05[B] cited). (Neil P. Myers ed., LexisNexis 2011) 41. Nimmer, § 2.10 and § 10.07. 38. Id. § 2.05[A]. 42. Id. § 2.06.

American University Intellectual Property Brief 15 Capturing Clouds spectacles, arrangements of scenic effects,” and fragmented literal similarity, or comprehensive non- chorography “devoid of story or content” are not literal similarity.50 Striking similarity does not require considered dramatic works.43 Pantomimes and a showing of access and, in the absence of direct choreography are “significant gesture[s] without speech” proof, copying may be inferred from circumstantial and are protectable whether or not the presentation evidence.51 Literal similarity is either verbatim copying is dramatic.44 Jokes and gags can claim copyright or paraphrasing.52 Fragmented literal similarity protection if the work rises from the level of an idea “exists where ‘the work [copies] only a small part of to an actual expression (not an easy threshold because a copyrighted work but does so word-for-word.”53 cleverness is idea-based) and stage direction remains Comprehensive non-literal similarity is evident where un-litigated.45 the fundamental essence or structure of one work is One does not need to author subject matter to duplicated in another.”54 become an owner of a copyright: she can also gain Parties can also infringe vicariously if they (1) have ownership within the context of a ”work-made-for- the right or ability to control and (2) directly benefit hire” relationship with the author. A work-made- from the infringing activity (landlords are generally not for-hire relationship is created through employment vicariously liable for the infringement of a tenant, i.e. or if there is a written agreement that the work is owner of a property leased to a infringing dance club).55 work-made-for-hire and the work falls within one Contributory infringement requires that the infringer of nine limited categories: (1) a contribution to a (1) had knowledge and (2) acted in furtherance of the collective work, (2) a part of a motion picture or other infringement but is defeated if a non-infringing use is audiovisual work, (3) a translation, (4) a supplementary shown.56 work, (5) a compilation, (6) an instructional text, (7) An otherwise infringing party can claim the a test, (8) answer material for a test, or (9) an atlas.46 affirmative defense of fair use. Courts consider: (1) the Unless the work falls specifically under category (2), it purpose and nature of the use, (2) nature of the work, is doubtful that it will obtain work-made-for-hire status (3) amount used, and (4) the effect on the potential in relationship to producing live entertainment. market.57 Parody can be a fair use defense wherein Once an owner establishes her copyright, she it “comment[s] upon or criticize[s] a prior work by proves infringement by showing the defendant (1) appropriating elements of the original in creating a new had access to the copyrighted work and (2) that the artistic, as opposed to scholarly or journalistic work.”58 infringing work is substantially similar to the protected work.47 Proof of access requires that the infringer had an “opportunity to copy the plaintiff’s works” and can be proven by (a) establishing a chain of events between 50. Letterese and Assoc. Inc. v. World Inst. Of Scientology the work and the access to the work or (b) showing that Enter., 533 F.3d 1287 (11th Cir. 2008). the work was widely available.48 A work is substantially 51. Miller, supra note 49, at n.156; Calhoun v. Lillenas Publ’g, 298 F.3d 1228, 1232 n.6 (11th Cir. 2002). similar when an average lay observer would recognize a 52. Miller, supra note 49, at n.156; Letterese, 533 F.3d at copy as having been appropriated from the copyrighted 1303 n.19. work.49 To show substantial similarity, a copyright 53. Miller, supra note 49, at n.156; Palmer v. Braun, 287 owner can show striking similarity, literal similarity, F.3d 1325, 1330 (11th Cir. 2002). 54. Miller, supra note 46, at n.156 (unpublished manuscript, sponsored by the Univ. of Houston Law Foundation); Warner Bros. 43. Id. Entertainment Inc. v. RDR Books, 575 F. Supp. 2d 513 (S.D.N.Y. 44. Id. § 2.07. 2008). 45. Id. § 2.13. 55. Warner Brothers, Inc. v. O’Keefe, 468 F. Supp.16 (S.D. 46. Stephen P. Koch & Joseph D. Yao, Drafting Iowa 1977). Confidentiality Agreements, Intellectual Property Law 101 IP 56. Sony Corp. of America v. Universal City Studios, Inc., Agreements (TexasBar CLE 2011). 464 U.S. 417 (1984); A&M Records, Inc. v. Napster, Inc., 239 F.3d 47. Arnstein v. Porter, 154 F.2d 464 (2d Cir. 1946). 1004 (9th Cir. 2001); Religious Technology Center v. Netcom On- 48. Sid and Marty Krofft Television Productions, Inc v. Line Communication Services, Inc., 907 F. Supp.1361 (N.D. Cal. McDonald’s Corp., 562 F.2d 1157, 1172 (9th Cir. 1977). 1995). 49. Warner Bros., Inc. v. American Broadcasting Co., 654 57. 17 U.S.C.A. § 107. F.2d 204, 208 (2d Cir. 1981) (quoting Ideal Toy v. Fab-Lu Ltd., 58. Mark Miller, Copyright Infringement 183 360 F.2d 1021, 1022 (2d Cir. 1966); Mark Miller, Copyright (unpublished manuscript, sponsored by the Univ. of Houston Law Infringement 25-6 (unpublished manuscript, sponsored by the Foundation); Suntrust Bank v. Houghton Miffin Co., 268 F.3d Houston Univ. Houston Law Foundation). 1257 (11th Cir. 2001).

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C. Trade Secret To protect a trade secret, a party might use Trade secrets are formulas, patterns, devices, or confidentiality agreements, specifically identify secret compilations of information used in one’s business, information, require routine and special contact with which “derive independent economic value from not employees who have access to secret information, create restrictions regarding outside contact, or debrief being generally known” and give one an advantage over 63 competitors.59 Trade secret is the only law (common employees. To infringe upon a trade secret, the law) that protects actual ideas.60 Protection of trade defendant must have acquired (misappropriated) the information wrongfully through improper means or secrets requires that the developer make continuous 64 effort to protect economically valuable ideas by keeping breach of confidence. them confidential.61 This protection is destroyed A potential defendant can limit their liability by through disclosure (accidental or not). Courts look (1) independent invention, (2) reverse engineering, (3) observation of the item in public, or (4) obtaining to whether the secret is ahead of industry awareness, 65 the extent to which the information is known outside information from published literature. of the original business, the affirmative steps taken to guard the secret, the value of secret to the originator and competitor, the amount of resources expended in developing the secret, and the ease or difficulty with which the info can be acquired.62

59. H. Clarke Anawalt, Ideas In the Workplace: Planning for Protection 23-88 (Carolina Academic Press, 1988); Metallurgical Industries v. Fourtek, 790 F.2d 1195 (5th Cir. 1986). 63. H. Clarke Anawalt, Ideas In The Workplace: Planning for 60. See id. Protection 23-88 (Carolina Academic Press, 1988). 61. Restatement (First) of Torts § 757 (1939); Tax Track 64. DuPont v. Rolfe Christopher, 431 F.2d 1012 (5th Cir. Systems Corp. v. New Investor World, Inc., 478 F.3d 783 (7th Cir 1970); Smith v. Dravo, 203 F.2d 369 (7th Cir. 1953). 2007). 65. Kadant v. Seeley Machine, 244 F. Supp. 2d 19 (N.D.N.Y. 62. Restatement (First) of Torts § 757 (1939). 2003).

American University Intellectual Property Brief 17 Capturing Clouds

IV. Practical Application of Intellectual a reality reflected in the practice of producing live Property and the Production Process entertainment. The issue of borrowing works or ideas “Semper idem, sed non eodem modo” is not an ethical dilemma; rather, it is of the correctness (“Always the same, but not the same way”). of process. ~ Heinrich Schenker ~ A. The Process Gone Wrong Understanding the legal protections for intellectual There is much to learn from the successes of The property can cause one to question the value in using Walt Disney Company with their industry leading the ideas, works, or marks of others. In the early 20th international entertainment portfolio. The unstoppable century, Pablo Picasso was amazing the world with the synergy between its motion picture division, animation creativity inherent in his paintings and sculptures.66 studios, touring shows and theme parks continues to Picasso’s art, however, was more than influenced by the pioneer the industry. There is also a lot to be learned impressionistic founder Edgar Degas. Picasso copied from the failures of Disney. In August of 2000, a themes, characters and processes from the impressionist judgment of 240 million dollars was entered in favor leader. Picasso went so far as to move down the street of All Pro Sports Camps against Disney for having from the older master and use the same models.67 Why misappropriated concepts for the Wide World of is it then that Picasso and Beethoven are held with such Sports Complex at Walt Disney World.69 Although high regard? the plaintiff failed to show substantial similarity in At some point in their lives as artists, Beethoven’s its federal copyright claim, it was later held that the and Picasso’s grappling with the creative processes Copyright Act did not preempt the common law trade of others grew into original works; “they [began] secret claim because the claim met the “extra element” to convert the substance or riches of [the other] to of unfair competition or breach of confidential [their] own use.”68 Therefore, copying works and relationship and fiduciary duty.70 borrowing ideas is a natural part of the artistic process, All Pro submitted a written proposal and business plan for the creation of the sports complex and Disney 66. Elizabeth Cowling & Richard Kendall, Picasso and All Pro entered into a joint venture wherein Looks at Degas (2010). 67. Id. Disney would provide the land, transportation, hotels, 68. Jeremy Yudkin, Beethoven’s “Mozart” Quartet, 45 J. Am. Musicological Soc. 30, 34 (Spring 1992) (“In 1785, at fifteen, Beethoven imitated Mozart to absorb, to learn, to grow. In 1800, 69. Satisfaction of Judgment, All Pro Sports Camps, Inc. v. at thirty Beethoven imitated Mozart in order to deliberately to Walt Disney Co., No. CI-97-134 (Fla. Cir. Ct. Sept. 16, 2002). ‘misprise’ him, to ‘convert the substance or riches of [the other] to 70. All Pro Sports Camp, Inc. v. Walt Disney Co., 727 So. 2d his own use.”). 363, 367 (Fla. Dist. Ct. App. Florida 1999).

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and golf course.71 It was noted during litigation that entities from cross-pollinating ideas and expressions All Pro submitted architectural models and sketches in violation of another’s trade secret or copyright? while using Disney computers, printing facilities, and Once tangible items are being produced, how does the secretarial staff.72 Although Disney succeeded in the producer ensure that the various companies contracted prior copyright litigation, they were not able to defeat to fabricate the designs are taking the appropriate steps All Pro’s claim that the “integration of, [sic.] elements to ensure their sub-contractors and employees protect of sport, education and entertainment” were novel and the project’s intellectual property? What if some not previously known to Disney.73 of these businesses use stock assets like pre-existing Again, this 240 million dollar judgment turned in music, stock imagery or video, or literary content part on whether Disney had previous knowledge of the owned by a third party? What becomes of derivative idea of combining the elements of sports, education and works created from these assets? What if a composer entertainment.74 edits an existing music track? What if that track is B. It Could Happen to You augmented with additional music or sound effects? What if a timeless musical hit needs “sweetening” by How does one introduce themselves, their ideas, adding post-produced effects or additional sounds (full and/or their services to other entities without creating sounding kick-drums, synthetic bass-lines, or techno the type of disclosure that destroys the protection of underscore)? If a director changes the plot of a show trade secrets? How can a producer enlist the services during rehearsals, what is his ownership right to that of the creative team without destroying the same change? What if a performer’s suggestion during a protection? Once in creative development meetings, rehearsal becomes content within the show? What if how does the producer ensure that the creative team a performer’s likeness becomes an iconic and branded is not infringing copyrights? Members of the creative moment within the show? How does one safely market team often design for and are exposed to the work a show that is levering the brand of an established Vegas product of other entities in the marketplace, so how sensation? What if your newest sensation is being can the producer protect the project from these diluted or blurred by other production companies? After one navigates these issues and opens a show, 71. Id. at 364. how are they mitigated over the run of on-going 72. Id. at 364-65. performances? 73. Id. at 368. Most importantly, how does one produce a show 74. Id. (“Thus, the concept behind Sports Island may not, in fact, be ‘generally known to . . . other persons who can obtain that addresses these issues without depleting the budget economic value from its disclosure or use.’”). or creative drive?

American University Intellectual Property Brief 19 Capturing Clouds

C. It Starts at the Beginning relationship.75 To create an employee relationship, There are a few professional precautions, that courts consider the skill required to perform the job, when taken at the beginning of the production the source of the instrumentalities and tools, the process, can help to reduce liability and ensure clear location of the work, the duration of the relationship, communication. Understanding who will own whether the hiring party has the right to assign the rights to work product, who will obtain and ownership of the work to the hired party, the extent of maintain the rights to existing assets, and how future the hired party’s discretion over when and how long to contributors will share in the rights of new and existing work, the method of payment, the hired party’s role in ideas and expressions will not only reduce liability hiring and paying assistants, whether the hiring party is a business, the provision of employee benefits, and the and potential frustration, but also help to reduce 76 both current and future production costs. The legal tax treatment of the hired party. For an independent instruments typically used to accomplish this are contractor relationship to be a work-made-for-hire, the employment agreements, work-for-hire agreements, work must (1) fall within nine categories of work (as non-compete clauses, non-disclosure/confidentiality described above); (2) be commissioned (courts consider agreements, and licensing agreements. All of these the motivating factor for commissioning); and (3) be instruments are contracts or clauses within contracts contracted expressly by a written and signed instrument (some courts require the agreement be made prior to and the purpose of each is to express the understanding 77 between the parties of who owns what in exchange for creation.) what.

D. Employment/Work-for-Hire Agreements 75. Michael D. Paul, State bar of Texas, Intellectual Although authorship normally vests in the person Property Law 101 IP Agreements, ch. 2 at 1-2 (2011); 17 U.S.C.A. § 101. who creates a work, an employer/contractee can 76. Id. at 2. acquire ownership of a work if it is prepared within the 77. Id.; Playboy Enter. Inc. v. Dumas, 53 F.3d 549 (2d Cir. scope of an employment or independent contractor 1995); Schiller & Schmidt, Inc. v. Nordisco Corp., 969 F.2d 410, 413 (7th Cir. 1992).

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E. Non-Compete Agreements Although there is an implied duty of non-disclosure A non-compete agreement is a restrictive covenant regarding trade secrets and confidential information, and under common law, an exception to the general a confidentiality clause can help to clarify the scope of protection but cannot “make secret that which is rule that an employer cannot prevent an employee 84 from competing.78 The agreement must (1) be already not secret.” To determine if a confidentiality contained within another contract (i.e. service or agreement is enforceable the courts generally employment agreement), (2) be designed to protect a consider whether (1) it is reasonably necessary for legitimate interest of the employer, (3) have adequate the protection of the employer’s business; (2) it consideration, (4) be reasonably limited in scope (time is not unduly restrictive of the employee’s rights; and territory), (5) be supported by valid consideration (3) it is not prejudicial to the public interest; (4) and (6) not be harmful to the public.79 Trade secrets, the employer is attempting to protect confidential confidential information, good will, and unique and information relating to the business, such as trade extraordinary skills are protected business interests secrets, methods of operation, names of customers, or while “covenant[s] . . . designed for some other purpose personnel data—even though the information does such as eliminating competition” are not.80 Consideration for not rise to the stature of a trade secret; (5) and the restraint is reasonably related to the protection of the the overall contract is sufficient for the non-compete clause 85 and the mere act of hiring an employee can be consideration information. When negotiating a non-disclosure (unless it is “at will” employment), but it is recommended clause, one should consider: key terms; confidentiality that the employer give “more money, greater responsibility, periods; confidentiality obligations; exclusions to or a new position.”81 Courts consider three factors when confidentiality; definitions of the access and use rights determining the reasonableness of the covenant: (a) whether to the proprietary information and standard of care; the restriction is greater than necessary to protect the the extent to which the information will be disclosed; employer, (b) whether the restriction is oppressive to the statements as to whether the information will be employee, and (c) whether the restriction is injurious to the returned; (for one-way agreements) a negation of general public (the public’s right to choose).82 reverse confidentiality obligation; a negation of implied licenses; negation of warranties and representations; F. Non-Disclosure and Confidentiality a negation of implied commitment for further Agreements relationship; a negation of the right to use other Non-disclosure and confidentiality agreements party’s name; and the duration of confidentiality and are basically the same instrument and both serve continuing obligations.86 similar purposes as non-compete agreements, “however, G. Back to the Process specific nondisclosure [and confidentiality] clauses are not subject to territorial limitations, and their When a producer recruits a creative team, it is reasonableness turns on the legitimacy of the advisable that she execute non-compete and non- employer’s business need to protect the information.”83 disclosure agreements, remembering that a non- compete agreement may only be effective once the creative team is contracted to work on the production. 78. Covenants Not To Compete §§ 1.01, 2.01 (Aspen Similarly, a producer must execute these instruments Publishers 2007); 14 Williston, Contracts § 1643 (3d ed. 1972); 6A when soliciting or receiving proposals for ideas that Corbin, Contracts § 139 (Supp. 1989); Hoddeson v. Conroe Ear, Nose & Throat Assocs., P.A., 751 S.W.2d 289 (Tex. App. 1988). 79. Id. 84. Richard A. Lord, Williston on Contracts §54:33 80. Covenants Not To Compete § 2.01 (Aspen Publishers (Thomson Reuters 2011); Structural Dynamics Research Corp. v. 2007); Owens v. Penn Mut. Life Ins. Co., 851 F.2d 1053 (8th Cir. Engineering Mechanics Research Corp., 401 F. Supp. 1102 (E.D. 1988); Harlan M. Blake, Employee Agreements Not To Compete, Mich. 1975); Union Pacific R. Co. v. Mower, 219 F.3d 1069 (9th 73 Harv. L. Rev. 625, 653-7 (1960); M. Jager, 1984 Trade Secrets Cir. 2000). Handbook § 13.05 (1984). 85. Richard A. Lord, Williston on Contracts §54:33 81. Id. (Thomson Reuters 2011); Coady v. Harpo, Inc., 719 N.E.2d 244 82. Covenants Not To Compete § 2.01 (Aspen Publishers (1st Dist. 1999); Revere Transducers, Inc. v. Deere & Co., 595 2007); Hamer Holding Group, Inc. v. Elmore, 560 N.E.2d 907 (1990). N.W.2d 751 (Iowa 1999); Julius Hyman & Co. v. Velsicol Corp., 83. Richard A. Lord, Williston on Contracts § 54:33 233 P.2d 977 (1951). (Thomson Reuters 2011); Lee v. Environmental Pest & Termite 86. Stephen P. Koch & Joseph D. Yao, State bar of Texas, Control, Inc., 516 S.E.2d 76 (Ga. 1999); Duracell Inc. v. SW Intellectual Property Law 101 IP Agreements, ch. 1 at 3-8 Consultants, Inc., 126 F.R.D. 571 (N.D. Ga. 1989). (2011).

American University Intellectual Property Brief 21 Capturing Clouds may be owned by other individuals or that may reveal is a contract that grants a party permission to use the producer’s trade secrets. This critical step can another party’s intellectual property for limited use, the slow a process and create awkwardness in the pacing consideration for which can include “a fixed payment, of conversation, but when done right, it can build a a royalty calculated as a percentage of licensee’s sales or professional relationship. It is also wise to stay aware income derived from the licensed property, or a fixed of when other contributors might be inadvertently payment upon execution of the agreement followed discussing trade secrets from past projects that could by the periodic payment of royalties.”87 The terms later be construed as misappropriated. Similarly, as of the agreement should consider (1) how derivative ideas become presentations, it is advisable to consider works are to be handled (what derivative works are, how their expression may need to be treated through whether derivative works are allowed, and whether either their tangible production or legal transfer of the licensee will benefit from the licensor’s derivative copyright so as not to create a copyright infringement. works), (2) whether the license is assignable, and (3) Similar procedures need to be followed when how each party will respond to claims of third party hiring or contracting designers for the creative infringement or that the licensed property is infringing development phase. The producer also needs to (duty of notice).88 It is important for a producer to (1) consider how these designers are enlisting the services understand the limits of liabilities within a licensing of their own design staff and using assets obtained from agreement (as she will want to know what penalties others. For example, under a transfer agreement with the project may suffer if she needs to terminate the the producer, the designers are obligated to transfer contract), (2) obtain written authorization of the the intellectual property rights associated with the licensee’s right to license the property and (3) secure work-product because of their work-for-hire status; warranties and indemnification from third party however, if they sub-contract additional designers, claims.89 without a transfer of copyright ownership from those A party can license a trademark in order to “extend sub-contractors, the authorship will vest the intellectual an existing and established trademark” (i.e. the owner property right in the sub-contractor and the designer of a trademarked brand can license another person to cannot transfer to the producer that which they do produce live entertainment based on that brand).90 In not own. Further, if a design firm uses stock imagery the instance of casting an artist with equity in their in their designs and executes a licensing agreement likeness and stature, a producer will need to license in perpetuity, they may assume they are meeting the that likeness, the terms of which will need to address producer’s requirement of transferring ownership; the artist’s name, likeness, biography, voice, and the but, although it might be in perpetuity, the licensing artist’s rendering of publicity services.91 When licensing agreement may not provide for uses not yet imagined moving images, the producer should secure: (1) the by the producer (i.e. print or video for marketing or literary rights to the story, characters, and title; (2) the derivative works). Another potential pitfall can arise rights to underlying materials integrated such as other from a composer who either unknowingly enlists the film/animation clips (3) performer’s reuse rights; (4) help of a lyricist without obtaining her fifty-percent music rights; (5) sequel rights; (6) the adaptation rights joint interest in the composition or allows a recording for existing assets used in the new product;” (7) waivers artist to rise to the level of an author by their creative of moral rights from the writer and director; and (8) contribution in a recording session. In these examples, rights necessary for marketing.92 When licensing still the producer has contracted for rights to be transferred images, confirm the copyright or public domain status to her, but the designers do not possess the rights they are attempting to convey. Although the producer has a 87. Drafting License Agreements § 1.01 (1996). breach of contract claim against the designers, through 88. Id. § 1.02; U.C.C. § 2-718(1) (1989); JMD Holding which she might be able to indemnify herself after she Corp. v. Congress Fin. Corp., 828 N.E.2d 604 (N.Y. 2005); Truck Rent-A-Center, Inc. v. Puritan Farms 2nd, Inc., 361 N.E.2d 1015 has settled with the actual copyright owner, she will no (N.Y. 1977); McGann v. United Safari, Inc., 694 S.W.2d 332 doubt incur damages because her use makes her, not (Tenn. Ct. App. 1985); LTR Rental Corp. v. Simmons, 595 P.2d the designer, the infringer. 1283 (Or. Ct. App. 1979). Some of these risks can also be mitigated through 89. Drafting License Agreements § 8 (1996). 90. Id. § 10.01. the use of another type of legal instrument: a license. 91. Id. § 11.01. Licensing Agreements. A license agreement 92. Id.

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of a photograph, illustration, trademark, or other held that synchronization licenses are required for the category of graphic art, which includes the term and non-infringing use of syncing newly recorded music the territory and secure (1) the adaptation rights for the with video in video games and a voice recording with image in the new product; (2) a waiver of moral rights a control talking mechanisms in Teddy Ruxpin stuffed from the artist(s); and (3) any “other rights necessary to bears; it follows that the definition of “audiovisual promote the product and broaden the product’s market, work” may one day expand to works that are used within such as advertising rights and merchandising rights.”93 the context of the highly synchronized layers of a live When licensing music, consider the following production.99 licenses: (1) a mechanical license; (2) a synchronization 3. A Public Performance License license; (3) a public performance license; (4) a license of dramatic work; and (5) an adaptation license. A public performance license is required to perform a musical composition publicly (i.e. background music 1. A Mechanical License and music festivals) and are available from performing A mechanical license (for non-dramatic work) rights societies such as ASCAP, BMI, and SESAC.100 derives its name from the need to license the 4. A License of Dramatic Work mechanical reproduction of music in piano rolls.94 One needs a mechanical license if a song is to be recorded A license of dramatic work is necessary if the music accompanies a dramatic performance (anytime the for distribution and the license covers the right to 101 record and distribute through a mechanical means (i.e. action tells a story). ASCAP and BMI expressly state Compact Disk orMP3).95 Most mechanical licenses are they are not granted the rights to license a dramatic permitted by statute and once someone makes a sound performance of the works of their musician cliental recording, anyone can thereafter make their own sound and thus, performing a musical work accompanied by recording: you merely tender the statutory royalties for dialogue, pantomime, dance, stage action or performed the sound recordings you make.96 as a musical comedy, opera, play with music, revue or ballet requires a dramatic licenses from the owner of the 2. A Synchronization License work.102 A synchronization license is directly applicable 5. An Adaptation License to the use of music in live entertainmen,t but to date “ha[ve] been given little consideration by the courts.”97 An adaptation license is necessary to alter to the Distinct from performance rights, a synchronization musical work (i.e. the “juxtaposition of lyrics with an instrumental musical work” or two-track editing of a license covers using a musical work in time relation 103 with another expression (i.e. audiovisual works).98 song into a different form or medley).” Although there are no specific instances of litigation Although the Harry Fox Agency, ASCAP, BMI regarding synchronization within the context of live entertainment, because live productions frequently use 99. Romantics v. Activision Publ’g, Inc., 532 F. Supp. 2d 884 (E.D. Mich. 2008); Worlds of Wonder, Inc. v. Vector video within their productions and music is synced Intercontinental, Inc., 653 F. Supp. 135 (N.D. Ohio 1986); Worlds to other mechanically driven visual components (i.e. of Wonder, Inc. v. Veritel Learning Sys., Inc., 658 F. Supp. 351 lighting, pyrotechnics, and other special visual effects), (N.D. Tex. 1986). 100. ASCAP Licensing Types, The American Society of there is potential for future issues to arise. Courts have Composers, Authors and Publishers, http://www.ascap.com/ licensing/general/types.aspx; Get a BMI Music License, Broadcast 93. Id. Music Inc., http://www.bmi.com/licensing/; Obtain A SESAC 94. Gary Myers & George Howard, The Future of Music: License, Sesac, http://www.sesac.com/Licensing/obtainlicense.aspx. Reconfiguring Public Performance Rights, 17 J. Intell. Prop. L. 207, 101. Melville Nimmer, Nimmer on Copyright § 2.06 214-15 (2010). (Neil P. Myers ed., LexisNexis 2011) (1963). 95. Drafting License Agreements § 10.01; Harry Fox Agency, 102. Synchronization, Harry Fox Agency, http://www. Mechanical Licensing, http://www.harryfox.com/public/ harryfox.com/public/LicenseSynchronization.jsp; Common Music MechanicalLicenseslic.jsp (last visited Nov. 10, 2011). Licensing Terms, The American Society of Composers, Authors 96. Drafting License Agreements § 10.01. and Publishers, http://www.ascap.com/licensing/termsdefined. 97. Lewis Rinaudo Cohen, The Synchronization Right: Business aspx (select the drop-down link “Dramatic or Grand Rights or Practices and Legal Realities, 7 Cardozo L. Rev. 787, 788 (1986). Dramatic Performances”); BMI and Performing Rights, Broadcast 98. Foreign & Domestic Music Corp. v. Licht, 196 F.2d 627 Music Inc., http://www.bmi.com/licensing/entry/C1289; Patry (2d Cir. 1952); E. Scott Johnson, Considering the Source: Licensing on Copy § 3:94. Threat to Performing Rights in Music Copyrights, University of 103. Drafting license Agreements § 10.01 (Michael A. Miami Ent. and Sports L. Rev. 6, 7 (1989). Epstein & Frank L. Politano ed., 1996).

American University Intellectual Property Brief 23 Capturing Clouds and SESAC have streamlined the process of obtaining agreements, and licensing agreements are also necessary various music licenses (namely performance and during the production phase. During this phase, the mechanical), they are not a complete solution; there is addition of builders, musicians, and artists increases no agency solution to securing synchronization rights, the risk of authorship manifesting in the work of rights to a dramatic performance or adaptation rights, sub-contractors. The risk of misappropriating the which must be obtained directly from the holder of the intellectual property of other production companies copyright.104 increases as scenic and costume companies, who have Because the purpose of this article is to address the relationships with many other production companies, needs of a specific tier of production companies, it must are brought into the project. As the designs manifest be stressed that this is a huge, mostly un-litigated liability into tangible items, the difficulty of ensuring that assets and, as this area of the industry expands, will certainly be are properly licensed also increases. If the producer more closely policed by owners of intellectual property. sets a tone from the idea generation phase of the H. Intellectual Property During the Process project, contracted entities will become accustomed to the intellectual property contract process and most The marketing plan begins to develop during the will begin to think through their own liabilities. idea generation phase of a project and the producer The process of insuring that intellectual property should ensure that the marketing strategy does not is protected will begin to flow naturally and, when appear poised to infringe a trademark. In order to followed, stimulates numerous new opportunities for ensure profitability, smaller productions frequently negotiations. For example, for smaller projects, the leverage on new, but established brands. The way producer now has the ability to create a relationship the show is interpreted by the consumers though with a composer who will be compensated based on the will greatly influence the risk of infringement. success of the production (through royalties) and thus Thus, the producer must strike a balance between require less front-end capital cost. (1) communicating to her audience the similarities The rehearsal process adds a few new issues to between the experience she offers and that of the consider, the first of which is the addition of the cast. trademarked show or event of which they have a As the quality of these smaller tier productions grow, positive impression and (2) not creating a likelihood of it is increasingly more important to ensure that the confusion between the marks that could create liability. producer owns the likeness of the performers and (as Non-compete clauses and non-disclosure agreements discussed above) the performance agreement needs to are also necessary during this phase so as to ensure the address the artist’s name, likeness, biography, voice, producer both protects her trade secrets and does not and publicity services. These are simple additions to misappropriate the trade secrets of others during the the performance agreement, but invaluable once the creative development sessions. show has earned brand equity. Another interesting, It is important to consider a licensing strategy as and mostly un-litigated question that arises during soon as the creative development phase is underway so the rehearsal process is any potential authorship that that the producer can ensure her budget can sustain the might manifest from creative decisions made by the impact of the necessary, ongoing licensing agreements. director or input from a cast member. A work created In each instance, she should consider the ongoing cost by this means could rise to the level of a derivative work of licensing to the higher cost of original creation. In or could create work of joint authorship because this one instance, a licensing fee in perpetuity might be tier of production can over-depend on the talent of a significantly less than the expense of constructing an director to create a coherent show from a less-developed asset from scratch. While in another instance however, script. the impact of royalty payments, frequent licensing Finally, it is imperative that all of these issues renewals, restrictions on the scope of use, increased are resolved before performances begin because costs for adaptations and synchronization, and the infringement occurs when the copyrighted work or risk of inadvertently infringing could justify a larger trade secret is placed in commerce: the performance capital commitment when compared to completely phase. Also, it is important to maintain awareness of original works.Non-compete clauses, non-disclosure how the ever-developing marketing plan flirts with trademark infringement. Now that the live production 104. Id. § 8.09[B][2]. is operational, it contains intellectual property assets

24 Fall 2011 Brian Knowlton that will need to be monitored with regard to others’ highest amount of integrity, and in ways that increases infringing use. The same principles apply, but now the likelihood of success, both creativity and financially. your production is protecting its assets. The law of intellectual property rights has but one V. Recapitulation ultimate goal: to encourage creation. “It seemed unthinkable for me to leave the world forever before I had produced all that I felt called upon to produce” ~ Ludwig van Beethoven ~ We find ourselves at an ending that closely resembles our beginnings. How and why do we borrow? How might we derive new creations from other’s works? What is there to learn and borrow from the process of other artists? How are shows uniquely presented to audiences in relation to other events in ways that leverage popular inclinations? So we end where we begin, that is, with a blank slate and without these answers. But we know the questions and that every instance of another’s work or idea is a color in the palette from which we create our works. All creativity is justifiably derived from some tangible experience. Master artists know this fact. It has been the intent of this article to show why it is permissible to exploit these influences and to give a legal perspective that ensures it is done with the least amount of risk, the

American University Intellectual Property Brief 25 The New Hawaiian Model:The Native Hawaiian Cultural Trademark Movement and the Quest for Intellectual Property Rights to Protect and Preserve Native Hawaiian Culture

by Nina Mantilla*

I. Introduction This Article argues that a new solution is needed In 2002, Disney released the animated movie to address the specific needs of Native Hawaiians, Lilo & Stitch, which told the story of an orphaned and it can be created by borrowing elements from Hawaiian girl and a marooned alien she mistakes for other successful cultural trademark programs. Part a dog. Native Hawaiians were disturbed to find that II examines the development of the Native Hawaiian the movie contained two mele inoa, traditionally used Intellectual Property Rights movement and also examines the current legal barriers to indigenous to honor King Kalākaua and Queen Lili‘uokalani, 5 two rulers in the 19th century known for their strong intellectual property protection. Part III argues that national and ethnic identity and role in the Hawaiian the common goals of self-determination in intellectual counterrevolution.1 Mele inoa are sacred name chants property rights between the Native Hawaiian and other that utilize a person’s name to honor them. These indigenous peoples globally allow Native Hawaiians to two mele inoa, traditionally viewed as a source of borrow elements of other existing intellectual property models to find a solution to the Native Hawaiian Native Hawaiian pride, were performed as a single 6 song and renamed for the orphaned character, Lilo.2 context. Part III also proposes a new model of Disney subsequently copyrighted the song for the protection, the New Hawaiian model, that combines movie’s soundtrack.3 The inaccurate and culturally elements of the New Zealand model and the Alaska insensitive presentation of these mele inoa in the movie model to create a solution for protecting indigenous forms of artistic expression that is uniquely tailored misappropriated traditional Native Hawaiian culture 7 and, along with growing incidences of bioprospecting, to the Native Hawaiian context. This Comment sparked Native Hawaiians to come together at the Ka concludes that this New Hawaiian model provides ‘Aha Pono ’03: Native Hawaiian Intellectual Property a customized solution for protection of traditional Rights Conference to address the growing problem of cultural expressions for Native Hawaiians, but misappropriation of traditional knowledge and culture.4 acknowledges that the model is an incremental step in what should be a larger movement in Hawaii to protect and preserve all aspects of Native Hawaiian culture. * Nina Mantilla is a 3L at American University Washington College of Law. II. Background 1. See Amy K. Stillman, History Reinterpreted in Song: The Case of the Hawaiian Counterrevolution, 23 Hawaiian J. A. The Native Hawaiian Cultural Trademark of Hist. 1, 13 (1989) http://evols.library.manoa.hawaii.edu/ Movement bitstream/10524/346/2/JL23007.pdf (translating to mean name chants). The use of the melo inoa in Disney’s Lilo & 2. See R. Hōkūlei Lindsey, Responsibility with Accountability: Stitch was not the first time Native Hawaiians dealt the Birth of a Strategy to Protect Kanaka Maoli Traditional Knowledge, with misappropriation of their native culture. Other 48 How. L.J. 763, 766 (2005) (quoting a notable Hula instructor stating that Disney “has no right to sell our collective intellectual examples of misappropriation included the Dodge properties and traditional knowledge.”); Stillman, supra note 1, at Kahuna, a cartoonish concept car that crossed a mini- 13 (describing and defining the types of traditional chants). van with a surf buggy.8 In Hawaiian, a kahuna is a 3. See U.S. Copyright No. PA0001101452 (registered July 2, 2002) (listing the title of the copyright as “He mele no Lilo,” and the owner as Walt Disney Music Company). 5. See infra Part II (outlining the current legal context in 4. See Lindsey, supra note 2, at 766-69 (describing Hawaii and the current status of indigenous intellectual property bioprospecting as the process by which large corporations gain rights in the United States and globally). exclusive rights to scientific discoveries appropriated from 6. See discussion infra Part III (analyzing current models from traditional knowledge holders, listing examples to include the which Native Hawaiians can, and should, borrow from). transformation of the Hawaiian Genome Project into an issue 7. See infra Part III (describing how this new model of intellectual property rights, rather than the original focus on incorporates elements that will work for the specific needs of the social responsibility, and the patenting of traditional knowledge by Native Hawaiian context). mainland biotech companies). 8. See Dodge Kahuna Concept Car (2003), Car Body

26 Fall 2011 person who participates in religious ceremonies; Native traditional knowledge.14 The Ka ‘Aha Pono ’03 Hawaiians found the use of the word in that way Conference produced the Paoakalani Declaration as its offensive.9 A recent study conducted by the Hawaii final product.15 The Paoakalani Declaration asserted Tourism Authority found that a majority of Native the self-determination rights of Native Hawaiians over Hawaiians felt the tourism industry in Hawaii is their TCEs and advocated the creation of a sui generis inauthentic and distorts their traditional culture.10 system that would empower Native Hawaiians to have Commercial misappropriation of Native Hawaiian complete control over TCEs.16 The Hawaiian State culture affects the ability of Native Hawaiian artists Legislature adopted the Paoakalani Declaration, and to make a living from their crafts.11 The combination then funded a study to determine the best legal solution of cultural misappropriation and unfair competition to the problem.17 in the marketplace is what Native Hawaiians have The Native Hawaiian Cultural Trademark Study sought to protect themselves against through adoption (Study) was sponsored by the Office of Hawaiian of the Paoakalani Declaration at the Ka ‘Aha Pono ’03 Affairs (OHA).18 The Study found that the majority Conference.12 of Native Hawaiian artists surveyed favored the use The Ka ‘Aha Pono ’03 Conference took place of a cultural trademark program19 to protect against in 2003, and brought together Native Hawaiian misappropriation and to provide public recognition of artists, elders, individuals experienced in spiritual Native Hawaiian cultural arts.20 and ceremonial practice, and individuals skilled in traditional healing and plant knowledge, among many others.13 After Disney’s misappropriation of traditional name chants and other incidences of 14. See World Intellectual Property Organization cultural misappropriation, Native Hawaiians began (WIPO) Intergovernmental Committee, Revised Draft preliminary work towards a solution that would Provisions for the Protection of Traditional Cultural Expressions/Expressions of Folklore 1, 3 (2010), http:// provide legal protection for their traditional cultural www.wipo.int/edocs/mdocs/tk/en/wipo_grtkf_ic_17/wipo_grtkf_ expressions (TCEs) and traditional knowledge by ic_17_4.pdf (borrowing the term “traditional cultural expressions,” first asserting their rights over Hawaiian TCEs and or “TCEs” from the WIPO Draft Provisions, designed to be all encompassing, and include any form of traditional cultural expression, tangible or intangible). Design (May 29, 2007), http://www.carbodydesign.com/ 15. See Paoakalani Declaration, supra note 12, at 2 archive/2007/05/29-2003-dodge-kahuna-concept/ (advertising (incorporating the statements of previously-produced unifying the car as embodying “California coastal culture,” rather than statements, such as the Mataatua Declaration and the Kari-Oca acknowledging the Hawaiian origin of the name). Declaration). 9. See John Book, Name for the new model of Dodge car is 16. See id. at 3 (defining self-determination to include the offensive to Hawaiians and the Hawaiian culture, http://www. right to freely determine political status and freely pursue economic, petitiononline.com/Kahuna04/ (last visited Nov. 14, 2010); see also social, and cultural developments and stating that because Definition of kahuna, http://www.websters-online-dictionary.org/ traditional knowledge is dynamic, it cannot be adequately protected definitions/kahuna (last visited Jan. 3, 2011) (stating that there are by rigid western intellectual property laws). more than forty types of kahunas, including healing professions, 17. See S. Con. Res. Recognizing Native Hawaiians and other cultural practitioners). as Traditional, Indigenous Knowledge Holders and 10. See Herbert A. Sample, Native Hawaiians say tourism Recognizing their Collective Intellectual Property Rights, industry distorts their culture, (Feb. 15, 2010, 5:00pm), http://www. S. Con .Res. 167, 22nd Leg. (Haw. 2004), available at http://www. usatoday.com/travel/destinations/2010-02-15-hawaii-tourism- capitol.hawaii.gov/session2004/bills/SCR167_.htm (recognizing survey_N.htm (noting that sixty percent of the Native Hawaiians that the western intellectual property system does not address surveyed disagreed that the tourism industry “helps to preserve the protection of indigenous peoples’ rights to their collective Native Hawaiian language and culture”). traditional knowledge); Committee Minutes, Office of Hawaiian 11. See Heidi Chang, Native Hawaiians seek cultural trademark Affairs Comm. on Beneficiary Advocacy and Empowerment (Mar. for art, Pacific Business News (Nov. 14, 2004, 12:00am HST), 17, 2004) (on file with author) (offering financial funding to http://www.bizjournals.com/pacific/stories/2005/11/14/story4. support the OHA commission to address the bioprospecting and html (explaining that imitators flood the market with cheaper fake intellectual property rights of Native Hawaiians). versions of authentic Native Hawaiian crafts, such as native drums 18. See Native Hawaiian Cultural Trademark Study, and leis). Final Report 1, 3 (January 2007) http://hawaiiantrademarkstudy. 12. See Ka ‘Aha Pono ‘03: Native Hawaiian Intellectual org/Media/TrademarkStudyReport.pdf [hereinafter Study] Property Rights Conference, Paoakalani Declaration 2 (Oct. (including collaboration on the final study from legal professionals, 3-5, 2003), http://kaahapono.com/PaoakalaniDeclaration05.pdf master artists, and academics). [hereinafter Paoakalani Declaration] (asserting that the creative 19. See id. (defining a cultural trademark program as one that cultural expressions of Native Hawaiians are misappropriated and uses a designator or symbol, on certain products to certify their commercialized in violation of their rights as cultural owners). authenticity). 13. See Paoakalani Declaration, supra note 12, at 1 20. See id. at 3, 9 (determining further that a cultural (including non-Hawaiians experienced in indigenous intellectual trademark would distinguish authentic Native Hawaiian arts from property protection). imitations in the marketplace).

American University Intellectual Property Brief 27 The New Hawaiian Model

B. The Legal Context of Indigenous Intellectual notes that registering an insignia does not provide Property Rights in the United States any affirmative legal rights akin to those of registering a trademark; rather, the purpose of registering an Intellectual property law protects copyrights, insignia is merely to prevent others from registering a patents, and trademark. Trademark is most relevant trademark.28 to the Native Hawaiian context because the Study, and therefore Native Hawaiians themselves, concluded b. Lanham Act Litigation that the most effective solution for protecting and As demonstrated by Pro-Football, Inc. v. Harjo, preserving Native Hawaiian TCEs is through the use of the burden to bring action under § 1052(a) of the 21 a cultural trademark. Lanham Act rests on Native Americans.29 In Pro- 1. Federal Statutes Football, Inc., Native Americans brought a claim under § 1052(a) to cancel six trademarks of the Washington The following subsections will outline current Redskins team, alleging that the marks “may disparage” United States federal and state law applicable to Native Americans or “bring them into contempt, or indigenous intellectual property rights, noting potential disrepute.”30 On cross-motions for summary judgment areas in the law that might provide protection to Native to review the decision of the Trademark Trial and Hawaiian TCEs. Appeal Board (TTAB), the court ruled in favor of a. The Lanham Act and Native American the defendants, Pro-Football.31 The holding requires Tribal Insignia Database Native Americans to actively monitor forthcoming The Lanham Act is the federal trademark statute.22 trademark applications for any offensive marks, and The purpose behind the Lanham Act is to protect additionally to bring a claim in a timely fashion against 32 goods and services used in trade, and to prevent the offensive trademark. consumer deception in the marketplace.23 The Lanham c. Indian Arts and Crafts Act Act limits registration to marks that are to be used In addition to the Lanham Act, the Indian Arts in commerce.24 Registration is not allowed under § and Crafts Act (IACA), enacted in 1935, is a second 1052(a) for trademarks “which may disparage or falsely potential way indigenous peoples can protect TCEs.33 suggest a connection with persons, living or dead The IACA authorizes a federally-recognized Indian institutions, beliefs, or national symbols, or bring them tribe to bring an action against a person who “directly into contempt, or disrepute[.]”25 This section seems to or indirectly, offers or displays for sale or sells a good offer potential protection to indigenous peoples against . . . in a manner that falsely suggests it is Indian cultural misappropriation and provides for the creation produced[.]”34 Although the IACA has specific criteria of the National American Tribal Insignia Database.26 for protection, the IACA does not have the same effect The Native American Tribal Insignia Database is a as intellectual property rights and only confers upon collection of insignia that the United States Patent and Native Americans a cause of action against those who Trademark Office (USPTO) refers to when determining if new trademark applications attempt to trademark the symbol of a federally or state recognized Native 28. See id. (noting further that the USPTO does not inquire American tribe.27 However, the USPTO specifically into the validity of a tribe’s insignia, and accepts the insignia as authentic so long as a federally recognized tribe submits it). 29. See Pro-Football, Inc. v. Harjo, 284 F. Supp. 2d 96, 21. See id. at 3 (finding that the majority of Native Hawaiian 123 (D.D.C. 2003) (stating that registrant has presumption that artists surveyed over the course of a 12-month period favored the trademark is valid and burden shifts to contestant). use of a cultural trademark program). 30. See id. at 99 (bringing evidence of expert testimony and 22. 15 U.S.C. §§ 1051 et seq. (2006). survey results alleging that the term “redskin” was a derogatory, 23. See J. Thomas McCarthy, McCarthy on Trademarks offensive reference to Native Americans). and Unfair Competition § 2:2 (4th ed.) (expounding on the two 31. See id. at 144 (focusing on the issues of evidence and goals behind any trademark statute). timing of the claim rather than the appropriateness of Native 24. See § 1051(a)(2) (stating that applications must include American imagery used in team names). the date on which the applicant first used the mark in commerce). 32. See id. at 145 (stating that a delayed claim makes 25. § 1052(a). it difficult for a fact-finder to determine if trademarks are 26. See id. (suggesting a connection with particular disparaging). institutions that is false, deceptive, or disparaging is a valid reason 33. See 25 U.S.C. § 305a (2010) (declaring the function for rejection of a trademark application). of the Act is to “promote the economic welfare of the Indian 27. See Native American Tribal Insignia Database—FAQs, tribes . . . through the development of Indian arts and crafts and USPTO, http://www.uspto.gov/trademarks/law/tribal/index.jsp, the expansion of the market for the products of Indian art and (last visited July 31, 2010, 1:14 PM) (explaining how federally craftsmanship”). recognized tribes can submit an insignia to the database and the 34. See id. § 305e(a)(4)(b)-(d) (defining which parties may effect of that submission). bring a cause of action).

28 Fall 2011 Nina Mantilla falsely suggest Native Americans made their products.35 2. State Trademark Law and Alternative Similarly to the Lanham Act’s disparaging mark cause Solutions of action, the burden still rests on Native Americans to 36 The Alaska Silver Hand Program is a state protect their TCEs. trademark law42 which uses identification seals to certify In 2000, Senate Report 452 stated that the IACA authentic Alaskan Native had not yet had a successful Art.43 The Alaska Silver Hand prosecution, and although Program is only available a decade has passed since to Native Alaskans who are that statement, House part of a federally or state Report 397, published in recognized village or tribe, 2010, reported the same 37 and living within the state of conclusion. Although many Alaska.44 The program issues claims have been filed, none a two-year permit for the use have progressed past a motion 38 of the identification seal, and to dismiss. However, this the permit can be renewed may change with the filing indefinitely.45 of a recent claim in Native An alternative model American Arts, Inc. v. Contract 39 for intellectual property Specialties, Inc. Plaintiff protection at the local level Native American Arts, is the example of the Gee’s Inc. alleged that defendant Bend Quilters of Gee’s Bend, Contract Specialties, Inc. Alabama.46 The Quilters violated IACA by selling of Gee’s Bend found a solution for protecting their goods in a manner that falsely suggested these products 40 TCEs through a relationship with the Tinwood are authentic Indian-made goods. The court denied Alliance, an Atlanta-based non-profit organization the defendant’s motion to dismiss, and the final dedicated to promoting vernacular art.47 Tinwood outcome of NAA’s claim, as based on the merits, is 41 Alliance contracted with the Gee’s Bend Quilters pending. for the intellectual property rights to all their quilts made prior to 1984, and then began displaying the 35. See id. (requiring that the product must be Indian-made, quilts in museums across the country.48 A licensing produced after 1935, and the producer of the Indian product must program controls the rights to the quilts and has led be a resident in the United States and including only civil causes of action); Protection of Products of Indian Art and Craftsmanship, to the use of the Gee’s Bend aesthetic in all kinds of 68 Fed. Reg. 35,164, 35,169 (June 12, 2003) (to be codified at 25 C.F.R. pt. 309) (defining “made by an Indian” as “that an Indian has provided the artistic or craft work labor necessary to implement an artistic design through a substantial transformation of materials 42. Alaska Stat. § 45.65.010(a) (West 2010). to product the art or craft work”). 43. See tit. 3, § 58.020(a)-(b); see also Alaska State 36. See § 305e(d) (requiring either the Attorney General, an Council on the Arts, Time Line Silver Hand Permit Program Indian tribe, an Indian, or an Indian arts and crafts organizations to and Related Events, http://www.eed.state.ak.us/aksca/pdf/ bring a claim). SilverHandProgramHistory.pdf (Jan. 28, 2010) [hereinafter Time 37. See S. Rep. No. 106-452, at 3 (2000); see also H.R. Rep. Line Silver Hand] (tracking the history of the program, beginning No. 111-397, at 3 (2010) (expanding the IACA criminal actions around 1972, with the first uses of the Silver Hand trademark). and sanctions in response to the lack of current successful claims). 44. See § 45.65.010(a) (stating that only those who meet these 38. See H.R. Rep. No. 111-397, at 2 (estimating that requirements may affix the identification seal to original Alaska although “very few cases relating to the sale of counterfeit Indian Native art or handicrafts). goods are investigated each year[,]” almost seventy-five percent of 45. See tit. 3, § 58.020(d) (placing no explicit limit on the the merchandise sold as authentic is not). number of times a permit may be renewed). 39. See Native Am. Arts, Inc. v. Contract Specialties, Inc., 754 46. See generally Victoria F. Phillips, Commodification, F. Supp. 2d 368, at 369 (D.R.I. 2010) (noting this is the first IACA Intellectual Property and the Quilters of Gee’s Bend, 15 Am. U. J. case in the First District, and one of the few to survive a motion to Gender Soc. Pol’y & L. 359 (2007) (arguing that the story of the dismiss). Gee’s Bend quilters can contribute to current debates regarding 40. See id. at 368 (commenting that NAA has filed between commodification and intellectual property laws). ninety and 120 claims since Congress amended the IACA in 2000, 47. See id. at 365-66 (recounting that the partnership was allowing Indian arts and crafts organizations to bring claims). spearheaded by the owner of Tinwood Alliance, William Arnett, 41. See id. at 373 (ruling that IACA did not violate the first after he was fascinated by the quilts from a photo in a book). amendment because IACA does not restrict artistic work, rather it 48. See id. at 366 (telling how the success of the quilts in regulates the way such art is marketed and that IACA passes rational museum exhibitions sparked spin-off projects based on the quilts basis review). including music, documentary films, and books).

American University Intellectual Property Brief 29 The New Hawaiian Model

homewares.49 With the help of Tinwood Alliance, the had taken a famous photograph entitled “Makanani,” Quilters of Gee’s Bend have formed a collective that is which was an image of a hula dancer kneeling on a owned, operated and run by the Gee’s Bend women.50 beach in a traditional pose.54 Reece first published the In addition to helping the Quilters form a collective to image in 1988 as a poster and then broadened the produce the quilts, Tinwood Alliance pays a royalty to image’s distribution, including use on greeting cards the community of Gee’s Bend on all licensed uses for and as picture frame inserts in Wal-Mart and Kmart the quilts made before 1984.51 stores.55 Reece brought a copyright action against the native artist who created the allegedly infringing C. The Legal Context in Hawaii stained glass artwork “Nohe” as well as the art gallery The following subsections outline the current displaying the work.56 The sacred nature of hula in legal context of Hawaiian state law with respect to Native Hawaiian culture is best demonstrated by the Indigenous intellectual property rights, as well as expert testimony presented at trial, in which Mapauna attempts by Hawaiians to change federal law with De Silva stated, “[h]ula is not just the images, the respect to such rights. motions, and the feet. It is the whole culture – the

Photograph entitled “Makanani” by Kim Taylor Reece, Stained-glass portrait in dispute in Reece v. Island showing a traditional hula pose. Treasures Art Gallery. Created by Marylee Leialoha Colucci.

1. Recent Case Law people, the places, stories, and names given to all those Currently, Hawaiian state law does not offer much things[.]”57 The court failed to recognize that the protection to Native Hawaiians. In fact, recent case law suggests the opposite.52 In Reece v. Island Treasures Art Gallery, Inc., a non-native photographer brought a L. Rev. 207, 245 (2009) (proposing that the Native Hawaiian copyright infringement case against a Native Hawaiian context demonstrates that legal pluralism is needed to protect 53 traditional culture). artist. Reece was a professional photographer who 54. See Reece, 468 F. Supp. 2d at 1200 (depicting a hula dancer performing the hula kahiko tradition, an ancient style of 49. See id. at 367 (listing products based on the quilts, and hula in which all the movements are standard). approved through licenses, including bedding, pillows, and pet- 55. See id. at 1200, 1204 (citing the widespread visibility proof rugs). of the photograph as evidence that the defendant had reasonable 50. See id. at 368 (noting that the Gee’s Bend collective serves opportunity to view it, an important factor in determining as the only source of the quilts currently made by the women). copyright infringement). 51. See id. at 366 (explaining that Tinwood Ventures 56. See id. at 1200 (describing the work as a stained glass purchased the rights to all quilts made prior to 1984). depiction, containing over 200 pieces of glass, including a far 52. See Reece v. Island Treasures Art Gallery, Inc. 468 F. Supp. greater variety in color than Reece’s sepia tone photograph). 2d 1197 (D.Haw. 2006) (ruling on narrow issues of copyright 57. See Decl. of Mapuana De Silva at ¶¶ 15, 20, 27, Reece v. infringement rather than addressing misappropriation of a Native Island Treasures Art Gallery, Inc., 468 F. Supp. 2d 1197 (D.Hawai`i Hawaiian cultural art). 2006) (No. 06CV00489), 2007 WL 6344621 (remarking that 53. See id.; Danielle M. Conway, Indigenizing Intellectual not only is it impossible to have a hula “pose” because of the fluid Property Law: Customary Law, Legal Pluralism, and the Protection of nature of hula movements, but that it is repugnant to suggest that Indigenous Peoples’ Rights, Identity, and Resources, 15 Tex. Wesleyan an individual can claim ownership over a hula movement).

30 Fall 2011 Nina Mantilla cultural art of hula belongs to Native Hawaiians or more favorable to the bill and on April 7, 2011, the recognize that no other judicial remedies are available Akaka bill was ordered to be reported out of the Senate to Native Hawaiians to protect their cultural art; rather, Committee on Indian Affairs, favorably and without the court ruled on the narrow issue of protectable amendment; however, the Senate must still vote on the elements within the photograph.58 bill.64 2. Proposed Legislation: The Akaka Bill D. The Current Legal Context of Indigenous The low-level of protection currently available to Intellectual Property Rights Globally Native Hawaiians for TCEs is largely because Native There is a wide array of international models for Hawaiians do not qualify for federal tribal recognition, establishing indigenous intellectual property rights. and therefore do not have access to the same programs However, when considering the Native Hawaiian 59 that Native Americans do. Daniel K. Akaka, United context, it is best to draw upon sui generis models.65 States Senator for Hawaii, introduced the Native Models that attempt to protect TCEs within existing Hawaiian Government Reorganization Act in 2009, intellectual property regimes are inappropriate for often referred to as the Akaka bill, which never made several reasons.66 Existing intellectual property 60 it out of the Senate in the last congressional session. protection, particularly trademark law, is designed The Act would have allowed Native Hawaiians the same to protect the sign or symbol as it interacts with 61 federally-recognized tribal status as Native Americans. the marketplace.67 This presents two problems for Despite wide support, the bill faced opposition in the indigenous expressions. First, protecting a sign or 62 Senate. The Akaka bill was reintroduced on March symbol does not address that often with TCEs, the 30, 2011, as was a companion bill in the House of underlying knowledge or cultural values are in need of 63 Representatives. This session of Congress has been protection.68 Second, traditional cultural expressions are either forced into the category of signs and symbols used in commerce, or faced with non-protection.69 For 58. See Reece, 468 F. Supp. 2d at 1207 (ruling that protectable elements of the photograph included lighting, camera angle, and the foregoing reasons, the following sui generis models perspective, and that when these elements are isolated it is clear provide the best answers to borrow or learn from for that the “Nohe” stained glass artwork did not infringe on Reece’s the Native Hawaiian context. copyright); see also Conway, supra note 53, at 245 (pointing out that the court “could have provided a more meaningful analysis of the copyright infringement dispute launched by a non-Native Hawaiian copyright holder against a Native Hawaiian artist who herself was raised and trained in the cultural art of hula, a traditional dance that . . . communicates the identity of Native Hawaiians.”). 64. Id. 59. See Study, supra note 18, at 33 (noting that federal law 65. See generally Legislative Texts on the Protection of requires a native group to be “continuously organized and governed Traditional Cultural Expressions, World Intellectual Property under a quasi-sovereign entity” in order to be recognized as a tribal Organization (WIPO) (Jan. 3, 2011), http://www.wipo.int/tk/ entity). en/laws/folklore.html (defining sui generis as “special laws and 60. See Native Hawaiian Government Reorganization Act, measures which specifically address the protection of traditional H.R. 2314, S. 1011, 111th Cong. (2010) (placing the bill on the cultural expressions/expressions of folklore” as opposed to working Senate calendar for this session); see also Daniel Kahikina Akaka, protection into existing laws). U.S. Senator of Hawaii: Native Hawaiian Federal Recognition, http:// 66. See Danielle Conway-Jones, Safeguarding Hawaiian akaka.senate.gov/issue-native-hawaiian-federal-recognition.cfm Traditional Knowledge and Cultural Heritage: Supporting the Right [hereinafter Akaka, 111th Congressional Session] (last visited Jan. 25, to Self-Determination and Preventing the Commodification of Culture 2011) (detailing the purpose, content, and status of the bill). 48 How. L.J. 737, 739 (2005) (asserting that Native Hawaiians 61. See Akaka, 111th Congressional Session, supra note 60 will not benefit from intellectual property laws that promote the (correcting false accusations by assuring that the bill would not commodification of culture). allow Native Hawaiians to secede from the United States, allow 67. See Susy Frankel, Trademarks and traditional knowledge private lands to be taken, or authorize gaming in Hawaii). and cultural intellectual property, in Trademark Law and Theory 62. See Akaka Speaks on Senate Floor, Reaffirming his 433, 445 (Graeme B. Dinwoodie & Mark D. Janis eds., 2008) Commitment to the Native Hawaiian Government Reorganization (pointing out the TRIPS Agreement requires that trademarks Act, http://akaka.senate.gov/pressreleases.cfm?method=releases. must be “capable of distinguishing the goods or services of one view&id=717cdf0e-c354-4019-a1d4-d223c7f5e747 (Dec. 22, undertaking from those other undertakings[,]” and further 2010) (stating that the bill is supported by Indigenous leaders and noting other inherent goals of trademark law include enhancing communities across the United States, including American Indians, competition and reducing consumer search costs). Native Alaskans, and the American Bar Association, which has 68. See id. at 445 (arguing that it is only a inadvertent side- written a statement affirming the Constitutional basis for the bill). effect of the symbol protection that the underlying cultural values 63. Daniel Kahikina Akaka, U.S. Senator of Hawaii: Native are protected from misrepresentation by third parties). Hawaiian Federal Recognition, http://akaka.senate.gov/issue- 69. See id. (additionally noting that the use of a trademark in native-hawaiian-federal-recognition.cfm [hereinafter Akaka, 112th commerce must often be maintained or the trademark owner will Congressional Session] (last visited Oct. 16, 2011). lose the registration for non-use of the symbol).

American University Intellectual Property Brief 31 The New Hawaiian Model

1. The SPC Framework and Guidelines 3. The New Zealand Toi Iho Program The Secretariat of the Pacific Community The toi iho cultural trademark program of New (SPC) published Guidelines (SPC Guidelines) and a Zealand has become a model for many other countries Framework (SPC Framework) in 2002 to assist Pacific seeking indigenous intellectual property protection.76 Island countries and territories seeking to establish legal The toi iho program uses trademarks to certify artwork protection for TCEs.70 The SPC Guidelines provide a that is of high quality and expresses traditional Mäori step-by-step guide for any group seeking intellectual culture.77 The program has the support of well-known property protection by posing both policy and legal Mäori master artists, and their public support of the questions for consideration.71 The SPC Framework program, as well as their knowledge of Mäori art, is provides a model law for protection of traditional crucial in setting The toi iho program’s high standards knowledge and expressions of culture that countries can of quality.78 adopt or from which they can borrow when creating III. Analysis their own protection regime.72 The SPC Guidelines and SPC Framework are tailored for small island Ideas from existing models for protecting countries and territories with relatively homogenous indigenous intellectual property rights should traditional cultures.73 be borrowed in a way that creates a tailor-made solution that addresses the unique needs of Native 2. The Panama Model Hawaiians. The demands of Native Hawaiians for Another example of a sui generis law from which self-determination in intellectual property rights are Native Hawaiians can borrow is Panama Law No. similar to those echoed throughout the world by other 20, enacted in 2000, and corresponding Executive indigenous peoples.79 Because they share numerous Decree No. 12, enacted in 2001 (Panama model).74 goals with other indigenous groups fighting for The Panama model stands out from other sui generis intellectual property rights, Native Hawaiians should models because it focuses exclusively on protection of borrow from these other models.80 TCEs that are capable of commercial use.75 promote and market the TCEs); see also Comparative Table on 70. See Regional Framework for the Protection Sui Generis Laws on Traditional Cultural Expressions/ of Traditional Knowledge and Expressions of Culture, Expressions of Folklore, World Intellectual Property Secretariat of the Pacific Community Background Page Organization (WIPO) 3 (Jan. 3, 2011), http://www.wipo. (2002), http://www.wipo.int/export/sites/www/tk/en/laws/pdf/ int/export/sites/www/tk/en/laws/pdf/suigeneris_folklore.pdf spc_framework.pdf [hereinafter SPC Framework] (collaborating [hereinafter WIPO Comparative Table]. to create the framework with the United Nations Educational, 76. See Study, supra note 18, at 30 (describing the Mäori Scientific and Cultural Organization (UNESCO), Forum Pacific Toi Iho program as the best model for a Native Hawaiian cultural Island member countries and territories, and the Council of Pacific trademark program). Arts). 77. See Te Puia—Treasuring Mäori Arts and Crafts, 71. See Guidelines for developing national legislation NewZealand.com (last visited Oct. 30, 2011), http://www. for the protection of traditional knowledge and newzealand.com/travel/media/features/maori-culture/maori- expressions of culture based on the Pacific Model Law culture_te-puia-maori-arts-crafts_feature.cfm (establishing that the 2002, Secretariat of the Pacific Community 14 (2006), http:// trademark is used to “promote and sell authentic, quality Mäori arts www.wipo.int/wipolex/en/details.jsp?id=6712 [hereinafter SPC and crafts” as well as to “authenticate exhibitions and performances Guidelines] (listing questions to consider including: what the of Mäori arts”). subject matter of protection should be, who the beneficiaries of such 78. See Study, supra note 18, at 28-29 (arguing that protection are, how should rights be formalized and managed, and participation of these master artists was crucial to obtain national what processes should be used for dispute resolution). and Mäori “buy-in” for the program). 72. See SPC Framework, supra note 70, at background page 79. See Paoakalani Declaration, supra note 12, at 2 (recognizing that the model law is merely a starting point from (supporting the statements made in the Kari-Oca Declaration, which countries should customize elements in accordance with Indigenous Peoples’ Earth Charter, and Mataatua Declaration on their own experiences, and further, that the model law is meant to Cultural and Intellectual Property Rights of Indigenous Peoples, provide only national protection). among others). 73. See id. (explicitly stating that the SPC Framework and 80. See Study, supra note 18, at 26-33 (analyzing existing Guidelines were developed to assist Pacific Island countries and solutions to determine which are most relevant to the Native territories). Hawaiian context); see also Mataatua Declaration on Cultural 74. See Act No. 20, Gaceta Oficial, June 26, 2000, http:// and Intellectual Property Rights of Indigenous Peoples, www.wipo.int/wipolex/en/details.jsp?id=3400 (naming the act the First International Conference on the Cultural & Special System for the Collective Intellectual Property Rights of Intellectual Property Regimes of Indigenous Peoples 2 (June Indigenous Peoples); Executive Decree No. 12, Ministry of Trade 12-18, 1993), available at http://www.wipo.int/tk/en/databases/ and Industries, Mar. 20, 2001, http://www.wipo.int/wipolex/en/ creative_heritage/indigenous/link0002.html (stating that indigenous details.jsp?id=3397 (regulating Act No. 20 of Jun. 26, 2000). peoples of the world have a “commonality of experiences relating to 75. See Act No. 20 at art. 1 (planning to protect TCEs the exploitation of their cultural and intellectual property” and the suitable for commercial use via a registration system designed to right to self-determination and exclusive ownership of their TCEs).

32 Fall 2011 Nina Mantilla

In addition to sharing goals with indigenous of traditional knowledge or expressions of culture.85 peoples internationally, Native Hawaiians also share It offers an incredibly high level of legal protection goals with Native Americans in the United States, and for TCEs by creating rights that last indefinitely should borrow from the intellectual property protection and by requiring prior informed consent from the given to Native Americans.81 Native Hawaiians traditional owners before third-party use is permitted.86 and Native Americans share the identical goal of Unfortunately, the SPC Framework is only able to safeguarding their culture and communities through offer such high levels of protection in exchange for preserving and protecting their TCEs, and therefore relatively little flexibility as to the type of community Native Hawaiians can gain much by borrowing from to which the rights can apply.87 Therefore, it is likely the current solutions proposed for the Native American to work only in the smaller island nations for which it context.82 was initially developed, where traditional owners are There is no one-size-fits-all solution to protecting more easily identified and a more coherent cultural indigenous intellectual property rights. However, the community exists.88 shared goals of self-determination and protection of traditional culture necessitates that Native Hawaiians 2. The Panama Model’s Market-Driven Focus borrow from existing models, both within and outside and Restriction to Communal Ownership of the United States, to create a new model that works Does Not Provide Enough Flexibility for The specifically for the Hawaiian context. Native Hawaiian Context The Panama model provides another example of A. Current International Solutions Do Not sui generis protection that could be useful to Native Address the Specific Needs of the Native Hawaiians.89 It aims to offer protection of TCEs that Hawaiian Context are capable of commercial use by implementing a 90 Examining current sui generis models that other system to register, promote, and market the rights. countries have enacted provides strategies and ideas This distinct emphasis on the ability of the TCEs to be capable of commercial use differentiates the that Native Hawaiians should apply to their situation. 91 However, as demonstrated by the following subsections, Panama model from other models. However, the none of the current international solutions should market-focused nature of the Panama model does be applied without some modifications to the Native not provide protection to those TCEs which are Hawaiian context.83 not meant, or which the artists do not want, to be 1. The SPC Framework Will Only Work in Smaller, Non-Diverse Populations Where a 85. See id. at 5 (defining traditional cultural rights as exclusive Coherent Cultural Community Exists control over publishing, reproducing, performing or displaying, recording, photographing, or translating any traditional knowledge The SPC Framework allows for flexibility in legal or expressions of culture). ownership by providing for individual or communal 86. See id. at 6-8 (explaining that a prospective user must ownership of TCEs, and looks to the group or clan’s either get prior and informed consent from traditional owner or ask customary law and practices to determine who is the Cultural Authority, which utilizes a public application process 84 in which traditional owners are given an opportunity to object to entrusted with these ownership rights. The SPC third-party use). Framework creates a new set of “traditional cultural 87. See SPC Guidelines, supra note 71, at 1-2 rights,” giving traditional owners control over the uses (acknowledging that the Guidelines are based on the needs of Pacific Island communities, and that other countries may have different ideological standpoints and cultural assumptions). 88. See Study, supra note 18, at 26 (arguing that the more 81. See S. Rep. No. 106-452, at *2 (2000) (describing the intact a cultural community has remained, the more likely the SPC TCEs of Native Americans as “an extension of their heart and soul,” Framework will work, unlike communities that have become diverse expressing a spiritual, intangible nature to these TCEs, echoing the through colonization and democratic rule such as Hawaii). way Native Hawaiians describe their TCEs). 89. See Act 20, Gaceta Oficial (Jun. 26, 2000), available 82. See id. at *1-2 (reporting that of the more than $1 billion at http://www.wipo.int/wipolex/en/details.jsp?id=3400; Executive in revenue for Indian-made goods, $400-500 million of the demand Decree No. 12, Ministry of Trade and Industries (Mar. 20, 2001), is being met by inauthentic and imitation products, demonstrating available at http://www.wipo.int/wipolex/en/details.jsp?id=3397. the detrimental financial effects of inauthentic goods). 90. See Act 20 at art. 1 (stating that this registration and 83. See generally Legislative Texts on the Protection of Traditional promotion system aims to guarantee social justice for indigenous Cultural Expressions (TCEs), supra note 65 (listing a full and cultures). comparative list of sui generis laws). 91. See WIPO Comparative Table, supra note 75, at 5-7 84. See SPC Framework, supra note 70, at 4 (noting further (listing the additional requirements of the Panama model: must that “the customary use of traditional knowledge or expressions of be based upon tradition, must fit within the classification system culture does not give rise to civil or criminal liability”). established by Article 3 of the Decree, and must be “collective”).

American University Intellectual Property Brief 33 The New Hawaiian Model used in commerce, as is often the case among Native Hawaiian context.99 Rather, it is the state trademark Hawaiians.92 The Panama model confers rights similar program from Alaska which offers the best example of to other models: the right of exclusion, the right to use indigenous intellectual property rights protection to in commercialization and reproduction, and the right Native Hawaii.100 United States federal law, including to prevent third-party usage.93 However, the Panama the Lanham Act, the Native American Insignia model lacks flexibility in ownership of the rights by Database, and the IACA, will not work for the Native only allowing for collective ownership, ruling out Hawaiian context. 94 protection for individual artists. Allowing only for 1. Current Federal Statutes and Programs Place communal ownership does not provide the flexibility Too Much of a Burden on the Indigenous that individual artists seeking protection for their TCEs 95 Population to Protect Traditional Cultural need, as is the case in Hawaii. The Panama model, in Expressions which the collective indigenous community functions as if it were a single owner, does not offer protection to The following subsections identify the smaller collectives of artists or individual artists.96 shortcomings in current federal statutes and programs for protecting TCEs, concluding that current United B. Current National Solutions Fail to Offer States federal law places too high a burden on Ideas to Native Hawaiians Indigenous populations to protect their own TCEs. The potential legal solutions present seemingly a. The Lanham Act is Inadequate Because Its promising solutions to Native Hawaiians in their Commercial Focus Does Not Address the pursuit of TCE protection. Unfortunately, none Specific Needs of Native Hawaiians of these federal programs are available to Native The Lanham Act requires that a trademark be used Hawaiians because Native Hawaiians do not qualify 101 97 in commerce to qualify for registration. Emphasizing as a federally recognized tribe. Native Hawaiians only commercial use of a trademark does not address are not listed under the 564 tribal entities that are the Native Hawaiian’s desire to have a specifically federally recognized and eligible to receive funding and cultural trademark, with a dual focus of protecting services from the Bureau of Indian Affairs.98 The Akaka TCEs in commerce and also preserving traditional bill seeks to address this inequality; however, even if Native Hawaiian culture.102 Additionally, the Lanham the Akaka bill passes, none of the federally-funded Act provides no answer to the issue of communal options provide workable solutions for the Native ownership.103 Further, the Act places a heavy burden on Native Americans to defend their TCEs, which is demonstrated by the real-world operation of both the 92. See Decl. of Mapuana De Silva at ¶¶ 18, 19 Reece v. Native American Tribal Insignia Database and section Island Treasures Art Gallery, Inc., 468 F. Supp. 2d 1197 (D.Hawai`i 1052(a), the disparaging mark section, of the Lanham 2006) (No. 06CV00489), 2007 WL 6344621 (remarking that hula Act.104 is not meant to be recorded or photographed for teaching purposes, that hula is meant to be passed down orally). 93. See Act 20 at arts. 2, 15, 20 (explaining that the authority to grant third-party usage rests exclusively with the indigenous peoples). 99. See Study, supra note 18, at 17 (pointing out the 94. See Executive Decree No. 12 at arts. 5-6 (making no problems that Native American have had with over-reliance on mention of the potential for individual as well as communal federal government programs). ownership). 100. See Alaska Admin. Code tit. 3, § 58.020 (2010) 95. See Study, supra note 18, at 12-16 (surveying individual (outlining the basic components of the Alaska Silver Hand program artists about their intellectual property needs). under state trademark law). 96. See Act 20 at art. 16 (explaining that general congresses, 101. See 15 U.S.C § 1051(a)(2) (2010) (requiring the or traditional authorities, of a community are treated as the owner applicant include the date of first use of the mark in commerce and of the rights and the congress creates rules as a single unit regarding the goods in connection with which the mark is used, in addition to regulation of the rights). a drawing of the mark). 97. See Study, supra note 18, at 33 (explaining that, unlike 102. See Study, supra note 18, at 9 (expressing that a cultural other states, which can recognize state tribes, Hawaii does not trademark program would provide public recognition of master have state tribal recognition powers, because it is not within the Native Hawaiian artists and therefore preserve cultural traditions by continental United States). encouraging teaching and mentoring of new generations of Native 98. See Indian Entities Recognized and Eligible To Receive Hawaiian artists). Services From the United States Bureau of Indian Affairs, 75 Fed. 103. See § 1051(a) (referring only to applicants in terms of a Reg. 60,810 (Oct. 1, 2010), available at http://www.bia.gov/idc/ singular “person” or “owner” of the trademark). groups/xraca/documents/text/idc011463.pdf (listing a separate 104. See Native American Tribal Insignia Database—FAQs, section that includes native entities within the state of Alaska supra note 27 (requiring that Native Americans arrange to have their eligible to receive services from the U.S. Bureau of Indian Affairs). insignia submitted to the database).

34 Fall 2011 Nina Mantilla

i. The Native American Tribal Insignia IACA does not.110 The IACA does not stop a third Database is Insufficient Because the Da- party from copying the design of a Native American tabase Confers No Legal Rights Akin to and then selling it, so long as it is not labeled in any Intellectual Property Rights way that would indicate that it is “Indian-made.”111 The Native American Tribal Insignia Database is a In addition to not addressing the limited rights the passive stance to protection of indigenous culture on IACA confers on Native Americans, it also does not the part of the federal government. First, the Native address the main concern of Senate Report 452: mass- productions of Indian-imitation products undercutting American Tribal Insignia Database places the burden 112 for protection on Native Americans by requiring the legitimate, authentic Indian-made market. The IACA is only a regulation on the labeling of products, Native Americans to register their tribal insignia with 113 the government.105 Second and more importantly, the an issue often brought up in the IACA suits. The Database confers no legal rights to the registration of complete absence of any successful prosecutions under an insignia.106 It explicitly states that registration does IACA demonstrates that the legislation has been not provide any positive legal rights, such as the right an unsuccessful solution for Native Americans, and therefore not a solution from which Native Hawaiians to bring an infringement claim or to exclusive use of 114 the insignia, as would be the rights under a trademark should borrow. The recent case of Native American registration.107 Arts, Inc. v. Contract Specialties, Inc., may offer some new potential for Native Americans implementing the ii. The IACA is Inadequate to Address the IACA to protect their TCEs, but the limited rights and Needs of Native Hawaiians Because it singular cause of action available under the IACA will Only Creates a False Attribution Cause not meet the needs of Native Hawaiians.115 of Action that Native Hawaiians Do Not Qualify to Use b. The Lanham Act Litigation Demonstrates That the Indigenous Populations Have Not The IACA is not applicable to Native Hawaiians, Been Able to Use the Disparaging Mark but would also not be a good source from which to Cause of Action as a Means to Protect borrow concepts for protecting TCEs because the Traditional Cultural Expressions IACA only addresses inauthentic marketing of goods claiming to be Indian-made. It attempts to address a Although the text of section 1052(a) of the hole in the Lanham Act for Native Americans’ ability Lanham Act seems to offer promise to indigenous to protect their TCEs by offering a cause of action peoples, the way courts have applied the section as 108 seen in Pro-Football, Inc., operates as a kind of passive for false attribution. However, the right to bring 116 a false attribution claim only gives a cause of action aid on the part of the federal government. In Pro- against people who falsely attribute their work to a source, and does not grant separate affirmative rights 110. Compare 15 U.S.C. §1114 (2010) (listing causes of to the TCE in question.109 In contrast, intellectual action available to an owner of a registered trademark against third- property law offers the right to exclusive use and the party infringement), with § 305e(b) (allowing only an action to be right to bring a claim for infringement, which the brought against a person who sells a product and “falsely suggests it is Indian produced”). 111. See § 305e(b) (listing no other available causes of 105. See id. (listing the following requirements to registration: actions). a written request, depiction of the insignia at or near the center of 112. See S. Rep. No. 106-452, at *2 (2000) (arguing that 8.5x11 paper, the name and address of the tribe for correspondence mass-production of imitation arts and crafts at a fraction of the cost purposes, a copy of the tribal resolution adopting the depiction has required traditional Indian artists to either reduce their prices as the official insignia, and a signed statement by an official with and profit margin, or retire). authority to bind the tribe). 113. See Native American Arts, Inc. v. Contract Specialties, 106. See id. (stating explicitly the database is merely a Inc., 754 F. Supp. 2d 386, at 388 (D. Rhode Island 2010) tool to aid the USPTO examiners in evaluating new trademark (describing the IACA as a truth-in-advertising statute aimed at applications). preventing counterfeit products). 107. Compare id. (stating that registration with database 114. See S. Rep. No. 106-452, at *3 (stating there has does not confer any positive legal rights), with 15 U.S.C. §1114 never been a successful civil or criminal suit under the IACA); (2010) (listing the private causes of action available to an owner of see also H.R. Rep. No. 111-397, at 1 (2010) (describing that the a registered trademark against third-party infringement, as well as continually low amount of cases actually investigated under IACA available remedies). prompted Congress to implement amendments to the Act). 108. See 25 U.S.C. § 305e (2010) (explaining what parties 115. See Native American Arts, Inc., 754 F. Supp. 2d, at 387 may bring a cause of action, the availability and limits on damages, (denying defendant’s motion to dismiss, allowing case to proceed and what a party must establish to prevail in a cause of action). forward on the merits). 109. See § 305e (granting no affirmative rights to contesting 116. See Pro-Football, Inc. v. Harjo 284 F. Supp. 2d 96, 99 parties). (D.C. 2003) (avoiding the public policy implications of the case

American University Intellectual Property Brief 35 The New Hawaiian Model

Football, Inc., the defendant Native Americans lost timing of a claim requires Native Americans to monitor on cross-motions for summary judgment for two forthcoming applications to ensure that offensive reasons.117 First, the court questioned whether the or disparaging marks are not registered.124 Overall, aggregate number of Native Americans would find the burden the Lanham Act places on indigenous the Washington Redskins’ trademarks offensive or peoples to bring a claim is too high for such people to disparaging.118 The court reasoned that although the successfully pursue a claim. term “redskins” is a derogatory term to refer to Native c. The Gee’s Bend Solution is a Small-Scale Americans, that mere use of the word by a professional Solution Entirely Dependent on Private football team in various trademarks does not mean 119 Funding and Will Not Work for the Large that the trademarks are offensive. The court’s logic and Diverse Native Hawaiian Population separates the everyday use of a disparaging word from the use of the same disparaging word in a registered The Gee’s Bend Quilters solution demonstrates trademark, even though the latter would seem to how a tailor-made program for protection of TCEs, be more offensive since registration is an implicit specific to the needs of the group involved, works endorsement of the disparaging word by the federal well, although it is an inappropriate model for Native 125 government.120 Hawaiians. The success of the Gee’s Bend solution The second reason the Native Americans lost the is dependent on the fact that a private actor had both motion for summary judgment was because of the a genuine interest in promoting the quilters’ cultural 126 doctrine of laches, the delayed bringing of a claim.121 arts and the financial ability to do so. The solution The court incorrectly infers that because Native works in a very small-scale, close-knit community, 127 Americans did not bring a claim when the marks and depends entirely on private funding. This were first registered in the 1960s, Native Americans small-scale, privately-funded solution is not a realistic must not have been truly offended by the trademarks, possibility for an entire population of native peoples, ignoring that perhaps Native Americans lacked the legal such as Native Hawaii, encompassing numerous art 128 and financial resources to bring such claims.122 This forms and numerous island communities. ruling suggests that even if a mark is deemed offensive Native Hawaiians should not borrow from the or disparaging, a court will not order cancellation of the currently available national solutions because they are trademarks if the claim is brought several years after the either not narrowly tailored enough to the address the mark is used in commerce.123 The court’s emphasis on needs of Native Hawaiians, or Native Hawaiians do not have legal access to the solutions. and focusing on the narrow issue of reviewing the TTAB’s decision and the laches defense). 117. See id. at 145 (stating that although this is “undoubtedly a ‘test case’ that seeks to use federal trademark litigation to obtain social goals. . . . By waiting so long to exercise their rights, Defendants make it difficult for any fact-finder to affirmatively state that in 1967 the trademarks were disparaging.”). 118. See id. at 121, 122 (pointing to the fact that the survey on which TTAB based its opinion used surveyed only twelve states and this could not be representative of the majority opinion of Native Americans). 119. See id. at 133 (deciding that the derogatory connotation of the word does not extend to the use of the term “redskins” in attack at any point after registration). connection with Pro-Football’s entertainment services). 124. See id. at 122 (demonstrating that the burden of proving 120. See id. at 124 (explaining the meaning of the word that a mark is disparaging rests on the party seeking cancellation). “disparaging” takes the ordinary meaning, which is that the 125. See Phillips, supra note 46, at 376 (noting how the mark may “dishonor by comparison with what is inferior, slight, partnership with Tinwood Alliance has allowed an ongoing dialogue deprecate, degrade, or affect or injure by unjust comparison”). of the needs of the quilters and their community). 121. See id. at 140 (pointing out that plaintiffs had known 126. See id. at 365-66 (describing the relationship between about the Redskins trademarks for at least a decade each and had the well-connected art scholar, William Arnett, and the Gee’s Bend not brought a claim in a timely fashion); see also id. at 136 (stating Quilters as collaborative in nature, and based on Arnett’s genuine that in trademark, a laches defense is used to argue that the plaintiff desire to promote the quilts as forms of artistic expression, rather “fumbled away its trademark rights through inattention”). than exploit the quilts through cheap imitations). 122. See id. at 140 (stating that the court’s finding of laches 127. See id. at 359, 370 (explaining how the profits of the correlates with the court’s findings that the TTAB’s decision did not Tinwood Ventures licensing activities are reinvested in the Gee’s meet evidentiary standards). Bend Community, a remote bend on the Alabama River). 123. See id. at 139 (reasoning that it would be both 128. See Study, supra note 18, at 26 (describing the Native inequitable and undermine the place of trademark in the free Hawaiian community as diverse and spread out over the islands of market economy to allow Pro-Football’s trademarks to be subject to Hawaii, requiring a solution with more flexibility).

36 Fall 2011 Nina Mantilla

C. The Toi Iho Program in New Zealand and has achieved greater success than other models and the Alaska Silver Hand Program Contain should be used as a guide for the Native Hawaiian Elements that Best Address the Unique context. First, the program is based on the right of 134 Needs of Native Hawaiians Seeking a indigenous peoples’ to self-determination. The Cultural Trademark Program rules of The toi iho program name the Te Waka Toi as the guardians of the marks, and that this indigenous The following subsections identify workable council will administer the rules of the program.135 elements from The toi iho program of New Zealand The implementation and administration of The toi and the Alaska Silver Hand Program that would be iho program acknowledges that indigenous peoples beneficial to the Native Hawaiian context. often need government funding to get such a program 1. The Toi Iho Program in New Zealand is started, but also that indigenous people have the right the Best International Model for Native to run the program autonomously in accordance with Hawaiians to Borrow From for Their Own their cultural traditions.136 Model The second reason for the success of The toi iho program is the program’s focus on the quality of Native Hawaiians should borrow heavily from artwork it certifies, rather than the ethnicity of the New Zealand’s toi iho program because The toi iho artist.137 The focus on quality rather than ethnicity program allows for indigenous self-determination, keeps the mark from becoming diluted through usage flexible ownership options, and art standards based on on common or low-quality products and prevents the quality of art rather than ethnicity of the artist.129 The “potentially divisive system of registering persons as program sets itself apart from other models through being of Mäori descent or blood quantum.”138 its emphasis on a high-level quality of artwork.130 The Finally, The toi iho program’s flexibility addresses two goals articulated by the program are to “maintain the modern reality that artists often collaborate and the integrity of the Mäori art culture” and “promote create art in collective form.139 The toi iho program Mäori art and artists nationally and internationally.”131 contains three different trademarks to ensure flexibility The dual goals of the Mäori program protect all forms in ownership: Mäori Made, Mainly Mäori, and Mäori of traditional cultural expression by protecting those Co-Production.140 The variety of cultural trademarks forms of art that enter the marketplace, as well as available to artists acknowledges that Mäori artists preserving those forms of art that are not meant for may collaborate with non-Mäoris and still create commercial uses.132 The program is able to maintain its works of authentic Mäori expression, thereby allowing high standards of quality by requiring artists to register annually to continue to use The toi iho trademark.133 There are three main reasons The toi iho program 134. See id. (stating that the indigenous peoples are the guardians of the trademarks and responsible for administration of 129. See The Arts Council of New Zealand Toi the rules and the program). Aotearoa, Rules Governing the use by artists of The Toi Iho 135. See id.; see generally The Arts Council of New Zealand Mäori Made Mark, 1 (Nov. 4, 2009), http://www.toiiho.com/ Toi Aotearoa Act 1994 No 19 §§ 13, 14(1)(e)-(i) (2009) http:// Apply/Rules/tabid/273/Default.aspx [hereinafter Mäori Made www.legislation.govt.nz/act/public/1994/0019/latest/whole. Rules] (describing the fundamentals of The toi iho program). But html?search=ts_act_Education_resel (creating the Te Waka Toi and see Toi Iho (Nov. 14, 2011), http://toiiho.blogspot.com/ (The stating they are responsible for administering all aspects of funding New Zealand government divested funding of the toi iho program and guidelines for Mäori arts). in 2009 and the program is currently in a state of transition to a 136. See Study, supra note 18, at 28 (describing the amount new, Mäori-controlled entity: TIKI- Toi iho Kaitiaki Incorporated of funding given to Mäori arts programs but also that Mäoris are Trust. TIKI is currently rebuilding the database of Mäori artists and given leading positions in the arts programs). expects to have an update website in the near future.). 137. See Mäori Made Rules, supra note 129, at 4 (requiring 130. See Study, supra note 18, at 29 (comparing The toi iho that the artwork be a work of high quality in addition to proving program to less successful models in which certification is based on Mäori descent of artist). ethnicity of the artist). 138. See Study, supra note 18, at 29 (arguing that programs 131. Mäori Made Rules, supra note 129, at 1 (administering based on ethnicity of the artist are unsuccessful because poor-quality these two goals will include the maintenance of a registry of artists works dilute the distinctiveness of a cultural trademark). currently using any toi iho marks); see also Rules Governing the 139. See id. at 31 (arguing that the success of The toi iho Use By Artists of The toi iho Mainly Mäori Mark, The Arts program is aided by the fact that it does not isolate itself within the Council of New Zealand Toi Aotearoa (Nov. 4, 2009), http:// Mäori community, but enlists support from the broader non-native www.toiiho.com/Apply/Rules/tabid/273/Default.aspx. public including art vendors, purchasers, and non-native artists). 132. See Mäori Made Rules, supra note 129, at 2 (protecting 140. See toi iho > About us, supra note 77 (reserving Mäori artwork in electronic form or other media, as well as performance made for artists of proven Mäori descent, Mainly Mäori for use by art in either live, electronic form, or other media). a group of artists, most of whom are of Mäori descent, and Mäori 133. See id. at 1 (requiring that the artist(s) continue to create Co-Production for use by collaborations between Mäori and non- quality works of authentic Mäori expression). Mäori artists).

American University Intellectual Property Brief 37 The New Hawaiian Model

performance art, and other group-oriented cultural arts, identity for the Mäori.147 protection within the program.141 The toi iho program allows the Mäori the right 2. The Alaska Silver Hand Program is the Best to self-determination because the Mäori set the Current National Solution and Contains standards of quality.142 The toi iho program also Key Structural Elements to Borrow When allows for great flexibility through the use of several Developing a Solution for the Native trademarks to protect all varieties of indigenous cultural Hawaiian Context 143 expressions. Finally, the program’s focus on quality, The Alaska Silver Hand Program is a state rather than ethnicity, addresses the reality of diversity trademark law that issues renewable identification seals and fluidity in cultural heritage. to Native Alaskan artists to verify that their works of art Given the popularity and success of the program, are authentic, original, and made in the state of Alaska, it came as a shock to many Mäori when, in 2009, the and is the most appropriate national model for Native New Zealand government cut funding for The toi iho Hawaiians to borrow from.148 The benefit of utilizing a program, stating that the program had not delivered the state trademark program is that garnering state support financial benefits to indigenous artists it had originally for such a program is easier than attempting to get 144 hoped for. The New Zealand government stated that federal support.149 The Alaska model is structured well, many Mäori artists were receiving high recognition but the ways in which these structural aspects have and sales for their artwork without the need of The toi been implemented present some problems. 145 iho trademark. Despite the official statement by the The structural aspects of the Alaska model that New Zealand government that The toi iho program stand out include the way the program is funded, the was not successful, Mäori artists were outraged at the use of a state arts council to administer the program, government’s decision to cut funding and demanded and the mandatory renewal process for use of the the government transfer the program to Transition identification seals.150 The program is self-funded with Toi Iho Foundation (TTIF), a group comprised of application fees to offset costs, which addresses the 146 toi iho artists. The overwhelming response from difficulty of gaining sufficient government funding.151 Mäori after the government’s announcement, and However, starting a brand new program, as would be subsequent reclamation of the program, demonstrates the case in Hawaii, would require initial government that this program not only plays a critical role in the funding before the program could self-fund through preservation and protection of indigenous art in New application fees.152 The use of a state arts council to Zealand, but is also a source of cultural pride and administer the program provides implicit government support and keeps the use of the trademarks centralized 141. See Mäori Made Rules, supra note 129, at 2 (defining and regulated.153 The Alaska State Council on the performance as any artistic presentation performed live, or reproduced in electronic form or other media). 142. See id. at 4 (granting and renewing of licenses to use 147. See Mäori Reclaim Toi Iho Trade Mark, supra note 146 the marks requires approval by a panel of persons with special (disagreeing with the government’s assessment that the program has knowledge of Mäori artforms). been unsuccessful, reporting that artists feel that the program has 143. See toi iho > About us, supra note 77 (providing for four been very successful and a source of price and cultural identity). different trademarks to choose from, depending on the applicant). 148. See Alaska State Council on the Arts Silver Hand Program 144. See Creative New Zealand statement on disinvestment in & Permit Application, Alaska State Council on the Arts toi iho, Creativenz.govt.nz, http://www.creativenz.govt.nz/en/ (AKASCA), http://www.eed.state.ak.us/aksca/Forms/individuals/ news/creative-new-zealand-statement-on-toi-iho (last visited Nov. SH.pdf (last visited Jan. 25, 2011) (explaining the operation of the 14, 2011) (stating that while the ideas behind The toi iho brand program and instructions for a permit). have remained important, the program has not met the goals of 149. See Study, supra note 18, at 11 (determining that trying increasing sale of Mäori art). to get federal support for a program to benefit Native Hawaiians 145. See id. (explaining that for many artists, “the quality of would require too much time and too many resources). their work speaks for itself” and that artists have not needed the use 150. See Alaska Admin. Code tit. 3, § 58.020(a)-(d) (2010) of the trademark to the extent originally thought). (stating the requirements for certification under the program). 146. See Mäori Reclaim Toi Iho Trade Mark, Voxy.co.nz 151. See Time Line Silver Hand, supra note 43 (implementing (Dec. 15, 2009), http://www.voxy.co.nz/national/maori-reclaim- a small twenty dollar fee for a two year permit to solve funding toi-iho-trade-mark/5/33358 (reporting that outrage followed issues). the announcement that New Zealand government planned to 152. See Panel Discussions, Keomailani Hanapi Foundation, “disinvest” in The toi iho program); see also Creative NZ agrees to http://www.khfnativehawaiianarts.com/PDF/2004_Panel_ transfer Mäori Trademark – toi iho, the big idea – te aria nui Hawaiian_Art_Transcript.pdf (pointing out that government (May 27, 2010), http://www.thebigidea.co.nz/news/industry- funding has allowed cultural trademark programs in other countries news/2010/may/70176-creative-nz-agrees-to-transfer-maori- to get off the ground). trademark-toi-iho (describing the formalities of the transfer from 153. See Alaska State Council on the Arts Silver Hand Program the New Zealand government to the TTIF and expecting the & Permit Application, supra note 148 (providing all arts education, transition to be complete by June 2010). development, and services under one state agency ensures that there

38 Fall 2011 Nina Mantilla

Arts is the agency that runs the Silver Hand program program which emphasizes self-determination for and issues permits to use the identification seals, and Native Hawaiians through the use of a Native Hawaiian the governor appoints members of this council.154 arts council, focuses on quality of art over ethnicity to However, there are no requirements that Native prevent dilution of the trademark, and allows flexibility Alaskan artists sit on the council, and consequently, in ownership and in trademark use. those issuing identification seals for native artwork are The New Hawaiian model would fit under not necessarily knowledgeable about Native Alaskan Hawaiian state trademark law, much like the Alaska art.155 Additionally, although the mandatory renewal Silver Hand program.160 As the Alaska model process seems to keep the use of identification seals demonstrates, it is easier to initiate a cultural trademark current, the renewal period does not require artists to program in the state legislature where the needs of demonstrate that they are still making authentic works local indigenous peoples are better understood and of art.156 The permits are also based on membership supported.161 Native Hawaiians understand how in an Alaskan tribe rather than the quality of the difficult it is to have federal legislators consider the work, which could lead to dilution of the Silver Hand unique circumstances of Native Hawaiians. 162 The trademark.157 Office of Hawaiian Affairs already supports the plight of Native Hawaiian artists, and funding would be more D. Combining Elements from Both the Alaska readily available from the Hawaiian state government Model and the New Zealand Model Creates than the federal government.163 Despite this initial a Custom Solution to Address the Unique government funding, the New Hawaiian model, like Needs of the Native Hawaiian Context the New Zealand model, would be administered by an Native Hawaiians favor the use of a cultural indigenous peoples’ arts council after the initial phases trademark program in order to protect and promote of the program.164 Native Hawaiian artists advocate the Native Hawaiian cultural arts, and the best solution limited government involvement in the administration will consider the unique needs of the Native Hawaiian and regulation of a cultural trademark program but also context and create a tailor made cultural trademark understand that government funding is a necessary tool program.158 This article proposes a solution entitled to initiate the program.165 Providing for administration the New Hawaiian model, which combines elements and regulation of the program by a Native Hawaiian of both the Alaska model and the New Zealand model. arts council would ensure that Native Hawaiians Combining elements of these two successful programs are assured the right of self-determination over the will give Native Hawaiians a critical tool to use in protection and preservation of traditional culture.166 protecting and preserving the Native Hawaiian cultural The New Hawaiian model borrows from both the arts.159 The New Hawaiian model is a state trademark Alaska model and the New Zealand model regarding the requirements for certification to use the cultural is no confusion for artists and consumers). 154. See AKASCA – Mission and History, AKASCA, http:// 160. See Alaska Stat. § 45.65.010(a) (2010) (protecting www.eed.state.ak.us/aksca/about.htm (last visited Jan. 25, 2011) certain articles created or crafted in the state by Alaska Native (defining the council’s missions to foster “the development of the persons, but does not preempt federal trademark law). arts for all Alaskans though education, partnerships, grants and 161. See Study, supra note 18, at 11 (arguing that the services.”). difficulty with getting support for the Akaka bill demonstrates that 155. See AKASCA – Council Members, AKASCA, http://www. national support would be tough to get). eed.state.ak.us/aksca/about3.htm (last visited Jan. 25, 2011) (stating 162. See id. at 11, 15 (citing that a majority of artists surveyed that the council is made up of eleven volunteer members all serving supported the idea of state funding of the cultural trademark staggered three-year terms). program). 156. See Alaska Admin. Code tit. 3, § 58.020(d) (2010) 163. See id. at 5 (demonstrating state legislature support (listing the only criteria for renewal as submission of a renewal for the program supports through formal adoption of Paoakalani application within thirty days of the end of the two-year permit Declaration and funding of OHA study). period). 164. See id. at 40 (supporting transfer of administration of 157. See tit. 3, § 58.020(c)(1)-(3) (requiring only that the cultural trademark program to an organization to be entitled the applicant is certified Alaskan Native and living in the state of “Native Hawaiian Cultural Arts Board”). Alaska); see also Study, supra note 17, at 29 (using the Australia 165. See id. at 11; see also Panel Discussions, supra note 152, at model as an example of how programs based on ethnicity rather 11 (speaking about money, panelist Meleanna Meyer stated “it’s a than quality will fail). necessary tool to allow us to do what we want to do”). 158. See Study, supra note 18, at 43 (confirming that the 166. See Study, supra note 18, at 40 (arguing that a Native Native Hawaiian community favors implementation of a cultural Hawaiian cultural arts council will be able to have powers far trademark program in Hawaii). beyond implementation of the trademark program to include 159. See id. at 40 (arguing that the similar worldviews of protecting heritage treasures, developing and recognizing emerging Native Hawaiians and the Mäori facilitates borrowing from the artists, promoting native arts education, and developing new Mäori example). markets).

American University Intellectual Property Brief 39 The New Hawaiian Model trademark.167 It would require artists to be residents model. It would employ several trademarks to allow of Hawaii to receive permission to use the trademark, artists to collaborate with non-Native artists.174 The similar to the residency requirements under the Alaska success of the New Zealand program has largely been model.168 Imitation products sold in the Hawaiian because the program gives native artists the choice tourism industry have a profoundly detrimental effect to collaborate with non-native artists and still create on the authentic Native Hawaiian arts market, and works of traditional cultural expression.175 The requiring that those who use the cultural trademark be New Hawaiian model borrows the two-year renewal residents of Hawaii provides an extra layer of protection requirement from the Alaska program, and would against imported fakes in the tourism market.169 The require artists to provide examples of quality works Study stated that a cultural trademark program should they have recently produced in order to qualify for identify native artworks that reflect a “cultural truth,” re-certification.176 Periodic renewal of the trademarks demonstrating that, for Native Hawaiians, it is more would ensure that artists are preserving the high-quality important for an artist to understand the Native standards of the trademark and still producing works Hawaiian cultural experience and traditional arts of authentic cultural expression to represent Native than prove pure blood quantum.170 This emphasis on Hawaiian cultural arts. an artist’s understanding of cultural truth combined IV. Conclusion with the proven success of the New Zealand model demonstrates that certification should be based on The New Hawaiian model is an important step in works of quality, rather than ethnicity.171 Borrowing the preservation and protection of Native Hawaiian from the New Zealand model, the standards of quality culture, and would give Native Hawaiian artists a should be determined by a set of well-known and way to distinguish their authentic works of art from well-respected master artists.172 Distinguishing works cheaper imitations in marketplace while simultaneously 177 of art based on quality rather than the ethnicity of elevating the status of Native Hawaiian cultural arts. the artist is particularly important for any program However, the New Hawaiian solution does not provide implemented under United States law, where a program answers to every example of cultural misappropriation; that discriminated based on ethnicity would likely be it would not stop Disney from copyrighting mele deemed unconstitutional.173 inoa, and it would not prevent Dodge from misusing The New Hawaiian model would borrow the Hawaiian words in car names. However, given the flexibility of ownership of the New Zealand model conclusion in the Study, the New Hawaiian model and the periodic renewal requirements from the Alaska presents a uniquely tailored solution that would align with the Native Hawaiian artists’ desire to implement a cultural trademark.178 Although a cultural trademark 167. See generally Study, supra note 18, at 41 (stating that the program is only an incremental step toward protecting trademark should be a newly created and visually distinctive design native culture, it is an important step nonetheless.179 that embodies the cultural essence of Native Hawaiians). Furthermore, placing administration of the program 168. See Alaska State Council on the Arts Silver Hand Program & Permit Application, supra note 148 (requiring proof of residency in the hands of Native Hawaiians will give them through current photo I.D.). the power and resources to expand into other areas 169. See Study, supra note 18, at 38-39 (suggesting the cultural trademark’s use in tourism industry will help weed out fakes and imitations while simultaneously emphasizing authentic 174. See toi iho > About us, supra note 77 (listing the variety of expressions of native culture with tourists). marks available and the purpose behind each mark). 170. See id. at 8 (commenting on the perspective of Native 175. See id. (allowing retailers and gallery owners to use a Hawaiians that “they do not think of the race or racial content of a mark to show that they are an official vendor of authentic art). person as defining the person’s standing in Native Hawaiian culture. 176. See Mäori Made Rules, supra note 129, at 4 (requiring It is a matrix of genealogy, kinship to indigenous families, cultural artist to demonstrate continual artistry upon submitting renewal lineage, and the source(s) of a person’s cultural knowledge rather application). than race that Native Hawaiian artists believe is important”). 177. See Study, supra note 18, at 29 (noting that The toi iho 171. See id. at 29 (arguing that focusing on quality rather than program has not only been able to distinguish authenticity in the ethnicity is more consistent and effective for achieving the goal of marketplace but also establish a reputation for excellence in the distinguishing imitation artwork from authentic artwork). arts). 172. See Mäori Made Rules, supra note 129, at 4 178. See id. at 3 (concluding that a cultural trademark (establishing that the panel in charge of artistic standards will be program would greatly benefit Native Hawaiian cultural arts). made up of “persons who Creative New Zealand considers have 179. See id. at 17 (referring to the statement of Maui specialist knowledge of Mäori artforms”). Solomon, a Mäori lawyer invited to the cultural trademark 173. See Study, supra note 18, at 34-35 (pointing out that it conference because of his involvement with The toi iho program, is not illegal for a trademark to be associated with a particular ethnic that a cultural trademark program is an important step in building or racial group but that in order to receive any government funding, the “cultural capacity” of indigenous peoples to demand and shape there can be no racial discrimination). their intellectual property rights).

40 Fall 2011 Nina Mantilla in need of solutions, such as native arts education and protection of traditional knowledge from bioprospecting.180 The New Hawaiian solution is an incremental step in what should be a larger dialogue in Hawaii of creating customized solutions to protect indigenous intellectual property rights and preserve Native Hawaiian culture.

180. See id. at 17, 18 (describing a cultural trademark program as producing a “ripple effect” that would empower Native Hawaiians “to develop the capability to exercise sovereignty over culture”).

American University Intellectual Property Brief 41 Informal Formalities: The Government’s Attempt to Find Families for Orphan Works by Mark Tratos*

I. Introduction recent attempt at orphan works legislation, the Shawn Orphan works are the death knell of copyright Bentley Orphan Works Act of 2008, would have law. They have been a growing predicament for the created a new type of copyright formality called “the United States since January 1, 1978 and there has never informal formality,” and how that would have impacted been a successful legislative attempt to fix it.1 That is copyright owners. The fourth portion of the paper will not to say that there has never been a good proposed address possible reactions to the implementation of solution to the problem though. The Shawn Bentley such a law. The fifth and final section will discuss why Orphan Works Act of 20082 was the closest the United such legislation is necessary and how a few changes to States Congress has ever come to solving the problem the Shawn Bentley Orphan Works Act of 2008 could of orphan works. However, the proposed solution lead to a more acceptable solution to the orphan works would have led to polarizing consequences that affected problem. previously disregarded elements of U.S. copyright II. Why do Orphan Works Exist? law. Instead of simply facilitating the eventual use of The term “orphan work” describes a situation orphan works by those engaging in good faith searches where an individual wanting to use a work in a way to find the owners of orphan works, the Shawn Bentley that would require prior permission from the copyright Orphan Works Act would have imposed a system of owner is not able to locate or identify the original “informal formalities” upon copyright owners while owner.3 The only two requirements to be an orphan functioning in the current “no formalities” system of work are that a work must be copyrighted, which has copyright law. The legislation would have reduced become significantly more likely since the elimination the number of orphan works in the United States by of copyright formalities, and that the owner of such a imposing penalties upon copyright owners, forcing work must be an individual who cannot be located.4 those owners to complete specific acts or meet certain These two simple requirements, when met, cause requirements in order to ensure their copyrights, while problems that only federal legislation can fix.5 the remedies for copyright infringement would stay Orphan works in the United States are the by- intact. This solution would fall in line with the basic product of Congress’s war against copyrighted works foundations of copyright law, but would also force the prematurely entering the public domain and the United States to question where its priorities lie. international community’s push for stronger creator This paper will first describe what orphan works rights.6 Orphan works first appeared on January 1, are, why they exist under current copyright law, and why they are currently a problem. Second, the paper 3. U.S. Copyright Office, Report on Orphan Works 1 (2006), will review the legislative history regarding attempted available at http://www.copyright.gov/orphan/orphan-report-full. solutions for the orphan works predicament. The pdf (traditionally in the form of a license for an exclusive right). third portion of the paper will describe how the most 4. Id. at 1-2. 5. Letter from Senators Orrin G. Hatch and Patrick J. Leahy to Marybeth Peters, Registrar of Copyrights (January 5, 2005), * Mark S. Tratos is a 2012 J.D. candidate at American reprinted in U.S. Copyright Office, supra note 3; Letter from University, Washington College of Law. He is an evening student. Representative Lamar Smith to Marybeth Peters, Registrar of He works for the United States Senate. Mark holds a B.A. in Copyrights (January 7, 2005), reprinted in U.S. Copyright Office, Economics and Ancient Studies from Washington University in St. supra note 3; Letter from Representative Howard L. Berman to Louis. Marybeth Peters, Registrar of Copyrights (January 10, 2002), 1. Copyright Act of 1976, Pub. L. No. 94-553, 90 Stat. 2541 reprinted in U.S. Copyright Office, supra note 3; U.S. Copyright (1976) (informing the public that the Copyright Act of 1976 was Office, supra note 3, at 15-17; see The Authors Guild v. Google, to become law on January 1, 1978); Shawn Bentley Orphan Works Inc., 770 F. Supp. 2d 666, 678 (S.D.N.Y. 2011) (“The question of Act of 2008, S. 2913, 110th Cong. (2008); Orphan Works Act of who should be entrusted with guardianship of orphan books . . . 2008, H.R. 5889, 110th Cong. (2008); Copyright Modernization safeguards are matters more appropriately decided by Congress than Act of 2006, H.R. 6052, 109th Cong. (2d. Sess. 2006); Orphan through an agreement among private, self-interested parties”). Works Act of 2006, H.R. 5439, 109th Cong. (2006). 6. Promoting the Use of Orphan Works: Balancing the Interest 2. S. 2913 of Copyright Owners and Users: Hearing before the Subcomm. on

42 Fall 2011 1978, the same day that the Copyright Act of 1976 copyright owners to register their works promptly, became effective.7 The problem became worse in even though it was not required to receive a copyright 1989 when the United States agreed to the terms of after 1909.15 Registration would in turn encourage the Berne Convention.8 These pieces of legislation individuals wishing to use the work to search the eliminated the long-held requirements (or “formalities”) registry of copyrighted works at the Copyright for copyright protection in the U.S.9 Office, which serves as the pre-eminent database of Copyright formalities were conditions or acts copyrighted works.16 This concept relies on the idea independent from simply creating the work required of that a search of the U.S. Copyright registry can yield a work’s creator to ensure that the work was protected fruitful results.17 Registration of a work also benefits by copyright.10 If someone wanted to ensure a the owner by serving as a prima facie presumption monopoly on the use of his work and retain the ability of copyright validity if the author registers the work to license the exclusive rights associated with that work, within five years of its publication.18 he would stringently adhere to the formalities or risk The formalities that were pervasive throughout the his work entering the public domain forever.11 This U.S. system of copyrights eventually found themselves required a number of actions, such as publishing the extinct after Congress eliminated formalities in four work, placing notice of copyright protection upon distinct ways. First, the Copyright Act of 1976 the work, depositing the work with the Library of granted copyright protection upon the fixation of the Congress, renewing the term of copyright protection, work, a change from the previous requirement that and recording the transfer of exclusive rights.12 One an author publish her work with notice or register an formality almost singlehandedly caused the orphan unpublished work before it could receive protection.19 works problem however. Creators now simply produce their work in order While U.S. copyright law does not require the to receive copyright protection.20 Second, the 1976 registration of an author’s work to gain copyright Act21and later the Copyright Term Extension Act,22 protection, it is required if an owner wishes to enforce extended the term of copyright ownership to the life their rights in the United States.13 In addition, for of the author plus an additional seventy years.23 The a rights-holder to recover attorney’s fees or statutory term of copyright protection has potentially tripled damages, she must register the work before the and the creator is not required to take any additional infringement occurs.14 This formality incentivized steps. Third, the alteration and extension of the term of copyright eliminated the renewal requirement found the Courts, the Internet, and Intellectual Property of H. Com. on in the Copyright Act of 1909.24 Fourth, the Berne the Judiciary, 110th Cong. 1-2 (2008) (Statement of Howard M. Berman, Chairman of the Subcommittee on Courts, the Internet, and Intellectual Property, of the House Committee on the 15. Copyright Act of 1909, Pub. L. No. 60-349, §§ 2, 10 Judiciary); see U.S. Copyright Office, supra note 3, at 3. (1909) (holding that publication of a work with notice would 7. See Letter from Senators Orrin G. Hatch and Patrick suffice requirements for copyright protection). J. Leahy to Marybeth Peters, Registrar of Copyrights (January 16. Derek Andrew, Inc. v. Proof Apparel Corp., 528 F.3d 696, 5. 2005), reprinted in U.S. Copyright Office,supra note 3 (“A 700-01 (9th Cir. 2008) (holding that the awarding of damages that principal concern is that the current Copyright Act might be are contingent on registration promotes the early registration of creating a class of ‘orphan works’ – works for which no copyright copyrights). owner can be found, and this which permission to use or to adapt 17. But cf. John Tehranian, The Emperor Has No Copyright: these works cannot be obtained.”). Registration, Cultural Hierarchy, and the Myth of American Copyright 8. Berne Convention for the Protection of Literary and Militancy, 24 Berkeley Tech. L.J. 1399, 1430-31 (2009) Artistic Works, art. 5(2), as revised on July 24. 1971, 1161 (acknowledging that search reports from the U.S. Copyright office U.N.T.S. 30, 35 available at http://treaties.un.org/doc/Publication/ will be non-interpretive and search criteria may not accurately UNTS/Volume%201161/volume-1161-I-18338-English.pdf identify the work or owner sought out). (eliminating all formalities which could prevent a creator form 18. 17 U.S.C. § 410(c) (2008). obtaining a copyright). 19. 17 U.S.C. § 102(2008); Copyright Act of 1909, Pub. L. 9. Promoting the Use of Orphan Works: Balancing the Interest No. 60-349, §§ 2, 10 (1909). of Copyright Owners and Users: Hearing before the Subcomm. on 20. 17 U.S.C. § 102(a) (noting that something will receive the Courts, the Internet, and Intellectual Property of H. Com. on the copyright protection if it is an original work fixed in a tangible Judiciary, 110th Cong. 20 (2008) (Statement of Marybeth Peters, medium). Register of Copyright); see U.S. Copyright Office,supra note 3, at 3. 21. See Pub. L. No. 94-553, § 302(a) (1976) (extending the 10. See U.S. Copyright Office, supra note 3, at 60. term of copyright ownership from 56 years to the life of the author 11. Jane C. Ginsburg, The U.S. Experience with Mandatory plus 50 years). Copyright Formalities: A Love/Hate Relationship, 33 Colum. J.L. & 22. See Pub. L. No. 105-298, § 102(b), (d) (2008) (extending Arts 311, 321-22 (2009). copyright protection an additional 20 years). 12. Id. at 315-18. 23. 17 U.S.C. § 302(a). 13. The Copyright Act of 1976, 17 U.S.C. § 411 (2008). 24. See U.S. Copyright Office, supra note 3 at 3; Copyright 14. Id. § 412. Act of 1909, Pub. L. 60-349 § 24.

American University Intellectual Property Brief 43 Informal Formalities

Convention, agreed to by the United States in 1989, Although the lack of effective search methods and eliminated the formal requirements that creators had to the current insufficiencies of the Copyright Office’s meet both to receive copyright protection and exercise Registry have made it hard to identify the owners their exclusive rights associated with copyright, which of copyrights, current technology and the culture included the visual notice requirements upon a work.25 surrounding digital works have made the process By the new millennium, copyright law protected works of identifying rights-holders even more difficult. in the United States upon fixation, for longer periods, Recent technological developments have facilitated with a much smaller chance for the work entering the the availability of works in digital formats and the public domain, and without requiring identification ability to copy those works multiple times over.31 Our that the work was actually protected. These four factors current technology-heavy, instant gratification culture suddenly made it much harder to discern whether a encourages the distribution of copies to one or two work was protected by a copyright. friends, who in turn disperse their copies in similar The abolition of formalities was only one factor ways.32 These copies often contain no information in the rise of orphan works. Despite the fact that that a searcher could use to identify the author or individuals now had to assume any work they rights-holder of the work.33 This is partially because of encountered was protected,26 copyright owners of those digital piracy and partially because of the elimination works could still be identified, meaning the work is of the notice formality from U.S. copyright law.34 The not an orphan work.27 The methods an individual problem is particularly pervasive in digital copies of can use to identify the owner of a copyrighted work, photographs.35 Current technologies allow users to whether in the U.S. or abroad, have never yielded encounter works in a multitude of ways that often sufficient or wholly accurate results.28 The U.S. afford no opportunity to identify the author or rights- Copyright Office Registry, the singular government- holder of the work. With no indication of the identity approved database available to individuals wanting of the copyright owner, potential licensors are forced to determine who controls the rights to a work, does to use the U.S. Copyright Registry and their own not provide an effective way to identify the owner of intuition to find the owner, both of which often prove a specific copyrighted work.29 Since a registry search to be unsuccessful.36 This is how orphan works came may not provide the necessary information sought to to be. identify a copyright owner, an individual must find III. Why are Orphan Works a Problem? the information in other ways, assuming the copyright owner registered the work in the first place.30 Both Congress and the Copyright Office believe that the orphan works problem has had a dramatic 37 25. Berne Convention for the Protection of Literary and impact on the economy. The copyright system in Artistic Works, art. 5(2), as revised on July 24. 1971, 1161 the United States has created a market around the U.N.T.S. 30, 35 available at http://treaties.un.org/doc/Publication/ UNTS/Volume%201161/volume-1161-I-18338-English.pdf (noting that the requirement for some form of notice upon any of the work to ensure the work or author searched for is the work or copyrighted work was a formality which would not comply with the author found. treaty). 31. See Diane Leenheer Zimmerman, Finding New Paths 26. See U.S. Copyright Office, supra note 3, at 15-16 (noting Through the Internet: Content and Copyright, 12 Tul. J. Tech. that automatic copyright protection could exist in cases where & Intell. Prop. 145, 146-47 (2009) (recognizing that the circumstances lead people to believe the work has no commercial Internet facilitates transactions outside the visible market, making value). transactions hard to monitor and control). 27. See id. at 1 (recognizing one of the requirements of an 32. See id. at 147. orphan work is that the creator or rights-holder cannot be found). 33. U.S. Copyright Office, supra note 3, at 23. 28. See also id. at 32-34 (determining that factors like the 34. Id. at 26, 41-42. cost of a search, the lack of identifying information on a work, the 35. Id. at 24. general obscurity of the work, and the country of the works origin 36. See Tehranian, supra note 17, at 1430-31 (acknowledging will hamper a potential licensor’s search or decision to conduct a that search reports from the U.S. Copyright office will be non- search). interpretive and search criteria may not accurately identify the work 29. See Tehranian, supra note 17, at 1430-31 (acknowledging or owner sought out). that search reports from the U.S. Copyright office will be non- 37. See Letter from Senators Orrin G. Hatch and Patrick interpretive and search criteria may not accurately identify the work J. Leahy to Marybeth Peters, Registrar of Copyrights (January 5, or owner sought out). 2005), reprinted in U.S. Copyright Office, supra note 3; Letter 30. When conducting an electronic search of the Copyright from Representative Lamar Smith to Marybeth Peters, Registrar of Office’s public catalogue, search entries will often provide you with Copyrights (January 7, 2005), reprinted in U.S. Copyright Office, a title of the work, the type of work, the year of the work’s creation, supra note 3; Letter from Representative Howard L. Berman to and the date of the work’s publication. The search will not provide Marybeth Peters, Registrar of Copyrights (January 10, 2002), you with any contact information in order to make contact with the reprinted in U.S. Copyright Office, supra note 3; U.S. Copyright author. The search entry will also no provide you with an example Office, supra note 3, at 15-17.

44 Fall 2011 Mark Tratos

control of exclusive rights to a copyrighted work.38 If potential copyright licensors.48 The Report on Orphan an individual wants to exercise the rights to a particular Works from the U.S. Copyright Office identified work she does not own, she seeks out the owner of that four general types of users who most often wanted to work and negotiates a contract or license to use the make use of orphan works, ranging from individuals work.39 Owners and potential licensors determine the wanting to incorporate orphan works into their own value of the rights to that particular work, thus shaping large-scale creations to individuals who are “small-time” the market and pushing the economy forward.40 This enthusiasts or who wish to obtain the work for private system of negotiations and eventual transactions uses.49 All of these potential users have the ability to necessitates, however, that an individual can find the bring new life or new audiences to works, but many author or rights-holder of a work.41 When searchers decide against using the work when they consider the cannot find the rights-holders, the copyright market potential liability standing in their way.50 Potential suffers.42 users of orphan works were unable to conduct business The fact that a work is an orphan does not mean in the market of copyright licenses and therefore that people do not still want to acquire the rights to Congress proposed orphan-work legislation.51 its use. In fact, the growth of digital works and the IV. Orphan Works Legislation Internet has increased the demand for the acquisition of rights from a variety of sources.43 When individuals are There have been a few recent attempts to pass unable to discover or locate the author or rights-holder legislation to correct the orphan works problem. of a work they wish to exploit, a potential licensor is Orphan works legislation was first proposed in the 52 forced to make a serious decision: does she use the United States House of Representatives in 2006 , but work without permission and risk an infringement the Orphan Works Act of 2006 never made it out of 53 lawsuit,44 or, does a she simply abandon her desire to the House Judiciary Committee . After it was clear use the work, choosing not to risk liability?45 Potential the legislation would never receive enough votes on the licensors often choose not to use the work.46 This floor of the House, supporters subsequently inserted fear of lawsuits has been incredibly debilitating to the substance of the 2006 Act into the Copyright 54 the market for copyright licenses and to the nation’s Modernization Act of 2006 , which was stuck in 55 heritage.47 committee. Attempts at an orphan works solution The inability to use orphan works without the fear did not die though, as legislation reemerged in 2008 56 of infringement suits has affected the entire market of through two different bills. The Orphan Works Act of 2008 appeared and subsequently died in the House of Representatives,57 and the Shawn Bentley Orphan Works Act of 2008 (S. 2913), which originated in 38. U.S. Copyright Office, supra note 3, at 15. 39. Id. 40. Id. 48. See Promoting the Use of Orphan Works: Balancing the 41. U.S. Copyright Office, supra note 3, at 1. Interest of Copyright Owners and Users: Hearing before the Subcomm. 42. See also Promoting the Use of Orphan Works: Balancing the On the Courts, the Internet, and Intellectual Property of H. Comm. on Interest of Copyright Owners and Users: Hearing before the Subcomm. the Judiciary, supra note 42 (asserting that when a copyright owner on the Courts, the Internet, and Intellectual Property of H. Comm. on cannot be identified and potential users abandon the work, several the Judiciary, 110th Cong. 19-20 (2008) (statement of Marybeth productive projects which may be beneficial to our national heritage Peters, Register of Copyright) (asserting that if there is no copyright are lost) owner, there is no beneficiary of the copyright terms and that is an 49. U.S. Copyright Office, supra note 3, at 36-40 (asserting enormous waste in the copyright market). that the categories of proposed uses are “uses by subsequent 43. C.f. Zimmerman, supra note 31, at 153-54 (asserting that creators,” “large-scale access uses,” “enthusiast uses,” and “private the internet is now seen as a place for new artists to be discovered, uses”). in addition to being a place where a large amount of piracy of 50. See 154 Cong. Rec. S3405-06 (daily ed. Apr. 24, 2008) unattributed works occurs). (statement of Patrick J. Leahy) (“[O]rphan works . . . often languish 44. See 154 Cong. Rec. S3437-38 (daily ed. Apr. 28, 2008) unseen, because those who would like to bring them to light, and (statement of Sen. Orrin G. Hatch); see also 154 Cong. Rec. S3405- to the attention of the world, fear the prospect of prohibitively 06 (daily ed. Apr. 24, 2008) (statement of Sen. Patrick J. Leahy). expensive statutory damages.”). 45. Id. 51. See S. 2913; H.R. 5889; H.R. 6052; H.R. 5439. 46. U.S. Copyright Office, supra note 3, at 15. 52. H.R. 5439. 47. See Promoting the Use of Orphan Works: Balancing the 53. See Yeh, Cong. Research Serv., RL 33392, Orphan Works Interest of Copyright Owners and Users: Hearing before the Subcomm. in Copyright Law 8 (2010). On the Courts, the Internet, and Intellectual Property of H. Comm. on 54. H.R. 6052 (appearing in Title 2). the Judiciary, supra note 42 (asserting that when a copyright owner 55. See Brian T. Yeh, supra note 53. cannot be identified and potential users abandon the work, several 56. Alessandra Glorioso, Note, Google Books: An Orphan productive projects which may be beneficial to our national heritage Works Solution?, 38 Hofstra L. Rev. 971, 980 (2010). are lost); id. 57. Id.; H.R. 5889.

American University Intellectual Property Brief 45 Informal Formalities the Senate and was passed by the higher house, was this, however, would prove to be truly controversial, eventually lost in House committee.58 The Shawn challenging the very tenets upon which U.S. and Bentley Orphan Works Act is the focus of this paper international copyrights currently rely. not only because the bill represented the culmination The drafters wrote the Shawn Bentley Orphan of changes deemed necessary after considering the Works Act of 2008 from the perspective of a rights- previous legislative attempts,59 but also because of the holder of an orphan work, with Section 2 of the Act likelihood that a bill resembling the Shawn Bentley dealing the most damage to said rights-holders. The Orphan Works Act of 2008 could be passed by the section informed the rights-holder that there was a United States Senate again, and possibly the House of limitation placed upon the remedies available to them Representatives in future. if someone infringed their work, should the Act deem it Congress introduced the Shawn Bentley Act of an orphan.64 Section 2 proposed that remedies would 2008 (S.2913) to solve the problem of orphan works. be limited if the alleged infringer “performed and S.2913’s primary goal, as agreed on by the bill’s documented a qualifying search, in good faith, to locate sponsors, was to identify the owners of such works.60 and identify the owner of the infringed copyright; By encouraging the identification of the authors or and was unable to locate and identify the owner of rights-holders of the orphan works, the Act would the infringed copyright.”65 After a more meticulous facilitate the licensing of these works to interested description of what a qualifying search would entail, parties.61 The Act was designed to keep the most the Act described the limitations upon remedies, basic tenets of U.S. copyright law intact, ensuring allowing the rights-holder to receive only “reasonable that a rights-holder may still benefit from their work compensation” from the guilty infringer.66 Rights- as they did previously.62 With these two aims in holders received a small allowance of injunctive relief, mind, legislators attempted to re-insert thousands of dependent on whether the infringer paid “reasonable previously unidentifiable and unusable works back into compensation” to the owner of the orphan work upon the licensing market.63 The way in which the Shawn identification of the owner or if infringement litigation Bentley Orphan Works Act of 2008 intended to do occurred.67 Therefore, while the Act proposed a way for potential licensors to identify the owners of orphan works68, it also notified those same owners that the Act 58. S. 2913; see Promoting the Use of Orphan Works: Balancing limited their enforcement rights and ability to recoup the Interest of Copyright Owners and Users: Hearing before the Subcomm. On the Courts, the Internet, and Intellectual property of H. damages, should they remain unidentified when an Comm. on the Judiciary, supra note 42. individual used their work. 59. See also Promoting the Use of Orphan Works: Balancing the Because of this shift, the Act required potential Interest of Copyright Owners and Users: Hearing before the Subcomm. infringers to perform a search for the rights-holders in On the Courts, the Internet, and Intellectual property of H. Comm. order to escape the liability for using an orphan work.69 on the Judiciary, supra note 42, at 24-25 (statement of Marybeth To conduct a “qualifying search” for the owner of the Peters, Register of Copyrights) (incorporating changes designed to protect visual artists, to document searches, to define “reasonable work, the individual would undertake a “diligent effort compensation,” and to address the availability of attorney’s fees). that is reasonable under the circumstances to locate 60. See also U.S. Copyright Office, supra note 3, at 93 (“Any the owner of the infringed copyright prior to, and at system to deal with orphan works should seek primarily to make the time reasonably proximate to, the infringement.”70 it more likely that a user can find the relevant owner in the first The diligent effort to find the rights-holders required instance”); 154 Cong. Rec. S3437-38 (daily ed. Apr. 28, 2008) (statement of Sen. Orrin G. Hatch); 154 Cong. Rec. S3405-06 a minimum of 5 steps to be taken: (1) a search of all (daily ed. Apr. 24, 2008) (statement of Sen. Patrick J. Leahy). Copyright Office records available to the public; (2) a 61. See 154 Cong. Rec. S3405-06 (daily ed. Apr. 24, 2008) search of all reasonably available sources of copyright (statement of Sen. Patrick J. Leahy) (believing that the identification owner and licensor information; (3) the use of all of rights-holders will help the owners receive compensation). appropriate technologies, publications, and experts to 62. See id. (noting that the act was not designed to change locate the owner; (4) the use of appropriate internet the basic premise of copyright law, that if you use the copyrighted works of others, you must compensate them for such use); see databases to locate the owner; (5) and performance of also Promoting the Use of Orphan Works: Balancing the Interest of Copyright Owners and Users: Hearing before the Subcomm. On the 64. S. 2913 § 2. Courts, the Internet, and Intellectual property of H. Comm. on the Judiciary, supra note 42, at 21 (statement of Marybeth Peters, 65. Id. § 2(b)(1)(A)(i)(I)–(II). Register of Copyrights) (“we do not wish to unduly prejudice the 66. Id. § 2(c)(1)(A). legitimate rights of the copyright owner by depriving him of the 67. Id. § 2(c)(2)(A). ability to assert infringement or hinder his ability to collect an 68. 154 Cong. Rec. S3,437-38 (daily ed. Apr. 28, 2008) award that reflects the true value of his work”). (statement of Sen. Orrin G. Hatch). 63. 154 Cong. Rec. S3437-38 (daily ed. Apr. 28, 2008) 69. S. 2913 § 2(b)(2)(A)(i) (statement of Sen. Orrin G. Hatch). 70. Id.

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any other actions when searching that could be deemed relief for the copyright owner, the Shawn Bentley “reasonable and appropriate” when considering the Orphan Works Act would have created, in essence, facts that have been discovered during the course of the a compulsory license for the exclusive rights of any investigation.71 The Copyright Office shaped the search orphan work. As a result of the Act, either the infringer through a statement of recommended practices,72 which would have found the owner of the orphan work attempted to hone the search for the rights-holder, as through a qualifying search and hopefully negotiated legislators rationalized that different search parameters a reasonable license, or the infringer would have been would prove effective for different types of works.73 unable to find the owner and would have used the work The limitations on remedies in the Shawn Bentley anyway. If someone used the work without finding Orphan Works Act of 2008 applied to both monetary the owner he or she might eventually pay the same relief and injunctive relief. The monetary damages reasonable cost of a license, but only if the owner of the previously available to a registered work include actual orphan work later identified themselves or sued. The damages, statutory damages, costs and attorney’s only possible options that a copyright owner would fees.74 These damages would no longer be available to have had to prevent his or her work from being used the rights-holder if the infringer met the “qualifying would be to deny the grant of a license when asked by search” requirements.75 Instead, the rights-holder potential users or make sure they could be found by only recovered “reasonable compensation,” which was potential users conducting a diligent, qualifying search. intended by the Copyright Office and legislators to In either case, an individual must be able to identify be the market value of the copyright license if they and locate the owner of the copyright. The desire to had engaged in negotiations of a license before the find the owners of orphan works started to look more infringement began.76 Even then, the Act placed the like legislators’ desire to use orphan works with or burden upon the copyright owner, not the infringer, to without the owner’s permission.80 prove that the work in question was worth market value Members of Congress threw the gauntlet. They at the time of infringement.77 If a copyright owner legislated a procedure for the potential infringer to wished to pursue injunctive relief upon the infringer of follow with the eventual destination being a copyright her copyright, the Act required stringent limitations. license. Individuals would know exactly what stops Infringers who successfully met the “qualifying search” they must take along the route: searching the records requirement of subsection (b) recovered monetary of the copyright office, using experts, scouring internet damages for the injury that the injunction would databases, and so on. In fact, the odds were better to cause.78 In addition the Act provided that, should an get a license if you performed a reasonable search and infringer meet the requirements of subsection (b) and did not find the rights-holder because at worst, you pay reasonable compensation to the copyright owner would end up paying reasonable compensation for the in a timely manner, the copyright owner would not license, and that was only if the owner of the orphan have the right to pursue injunctive relief of any kind.79 work appeared. So when Congress tried to force Through the limitation of monetary and injunctive authors and rights-holders to grant unwanted licenses, Congress said those same authors and rights-holders must do all they can to make sure their works do not 71. Id. § 2(b)(2)(A)(ii). 72. Id. § 2(b)(2)(A)(iii). become orphans. To do that, creators and rights- 73. Id.; see also U.S. Copyright Office, supra note 3, at 109- holders must purposefully place themselves and their 10. works in the public, assuring themselves that anyone 74. 17 U.S.C. §§ 504-05 (2006). who would wish to license their work would find them, 75. S. 2913 § 2(c)(1)(A). and thus retaining the ability to bring the weight of the 76. Id.§ 2(c)(1)(B) (holding that reasonable compensation United States Judicial System upon infringers. must not be paid if the infringer is a “nonprofit educational institution, museum, library, archives, or public broadcasting entity” V. The Creation of the Informal Formality or if the infringer proves the infringement was not done to receive a commercial advantage, the infringement was educational in nature, As legislators and the U.S. Copyright Office or if the infringers stopped infringement upon receiving a notice of observed the problems that orphan works were claim of infringement); U.S. Copyright Office, supra note 3, at 116. causing in the copyright market, they were left with a 77. U.S. Copyright Office, supra note 3, at 116-17 (noting that reasonable compensation, in many cases, may be found to be zero or royalty-free because similar transactions in the market 80. U.S. Copyright Office, supra note 3, at 8 (asserting that support such a finding). the first goal of orphan works legislation was to create a system that 78. S. 2913 § 2(c)(2)(A) (holding that the harm to the would make it more likely for users to find a relevant rights-holder infringer must be noted by the court before any injunctive relief can and negotiated a license agreement and recognizing that the second be granted). goal was to encourage use of orphan works only when the rights- 79. Id. § 2(c)(2)(B)-(C). holder could not be found).

American University Intellectual Property Brief 47 Informal Formalities predicament. Were they to re-impose the formalities between formalities that affect ownership of a copyright that originally prevented the existence of orphan works, or rights therein and formalities affecting whether a or were they to kneel before the orphan works problem copyright exists or whether a rights-holder can enforce and accept the mess as the new standard? The Shawn his rights.88 Those differences are the reason that Bentley Orphan Works Act of 2008 was an attempt to sections 411 and 412 of the Copyright Act of 1976 still navigate between the two extremes. Legislators alleged exist. U.S. Copyright law does not force individuals to it was not attempting to create formalities for copyright register their work with the Copyright Office in order owners to meet; however, they evidently thought that to receive a copyright.89 Instead, registration gives they must put some requirements in place to prevent copyright owners the power to enforce their copyright orphan works from overrunning the market.81 The and to receive different types of monetary damages concept of informal formality emerged. through infringement litigation.90 There has been An informal formality, as this author defines it, is speculation as to the legality of the relief limitations an action taken by the owner of a copyright to ensure imposed by U.S. copyright law in the face of the he do not lose any rights associated with that copyright. Berne Convention.91 Berne states that any copyright Unlike formalities however, copyright law does not registration system that affects or alters substantive, specifically require or even articulate these actions. An exclusive rights granted through copyright too closely owner will not necessarily lose his rights if he does not resembles a formality.92 If a copyright owner cannot complete the formalistic task. Instead, a copyright pursue statutory damages or attorney’s fees in an owner can choose to take this extra step to ensure that infringement action, little would be done to encourage there will never be a circumstance in which he will not copyright enforcement amongst rights-holders.93 lose his rights. Despite such a reading, the United States has continued Before the creation of the informal formality to require registration of a work to commence however, both the legislators and the U.S. Copyright infringement litigation. It is amongst this quagmire of Office knew they could not transgress the international international conventions and statutory law that the treaty limits.82 The Berne Convention, as well as Shawn Bentley Orphan Works Act of 2008 attempted other international agreements83, has prevented the to make its mark. imposition of formalities upon foreign authors.84 Despite the fact that the goal of orphan works Specifically, the Convention prevents the imposition of legislation was to identify the owners of orphan works, any requirement, other than the creation of the work the legislation was a roadmap for potential infringers, itself, to ensure an author retains a copyright.85 Most of charting a course on how to search for the owners of the countries that agreed to the Berne Convention no orphan works, with the destination being the use of longer require creators to comply with any copyright the orphan work in almost every situation. In order formality.86 However, the Berne Convention does not to prevent such uncontrolled use of orphan works, suspend all formalities.87 There is a notable difference copyright owners would have to make sure that they are along the side of the road, waving down each potential 81. U.S. Copyright Office, supra note 3, at 61 (“Any infringer, notifying them of who the rights-holder was. legislative solution to the orphan works problem, must not require This begins with the diligent effort requirement of the an author to comply with formalities if failure to comply with those “quality search.”94 formalities would result in the author becoming unable to enjoy or exercise copyright in the work.”). The first requirement of the diligent effort was an 82. Id. internet search of the publically available records of 83. See Agreement on Trade-Related Aspects of Intellectual the Copyright Office, assuming that the work provides Property Rights, Apr. 15. 1994, art. 9.1 Marrakesh Agreement enough identifying information on which a potential Establishing the World Trade Organization, Annex IC, Legal licensor can base a search.95 The registration of a work Instruments-Results of the Uruguay Round vol. 31, 33 I.L.M. 81, 87 (1994); World Intellectual Property Organization Copyright Treaty art. 3, Dec 20, 1996, 36 I.L.M. 65, 69 (1997); World 88. Id. Intellectual Property Organization Performances and Phonograms 89. 17 U.S.C. § 102 (2011). Treaty art. 20, Dec. 20, 1996 36 I.L.M. 76, 86 (1997). 90. Id. §§ 411-12. 84. Berne Convention for the Protection of Literary and 91. Berne Convention for the Protection of Literary and Artistic Works, art. 5(2), as revised on July 24. 1971, 1161 Artistic Works, art. 5, Sept. 9, 1886, (amended on Sept. 28, 1979), U.N.T.S. 30, 35 available at http://treaties.un.org/doc/Publication/ S. Treaty, Doc. No. 99-27 (1986) (“The enjoyment and the exercise UNTS/Volume%201161/volume-1161-I-18338-English.pdf of these rights shall not be subject to any formality”). (noting that the Berne Convention does not apply to a country’s 92. U.S. Copyright Office, supra note 3, at 61; Tehranian, imposition of copyright formalities upon its own creators). supra note 17, at 1439 (including significant remedies). 85. Id. 93. Tehranian, supra note 17, at 1439. 86. See Ginsburg, supra note 11, at 313. 94. S. 2913 § 2(b)(2)(A)(ii). 87. Id. at 314 95. Id. § (b)(2)(A)(ii)(I)(aa).

48 Fall 2011 Mark Tratos

with the Copyright Office would be a potentially to associate their works with these sources, simply in necessary step if copyright owners wished to be found hopes that the rights-holders would be more easily by potential licensors. The lack of comprehensive found, we can assume the rate of publication of works results that often occurs after a search of the Copyright will rise. While publication of a work has not been a Registry, however, made this step unlikely to be requirement of copyright protection in many years101, fruitful.96 The creator of a work would not only have it suddenly may be a way of ensuring that potential to register their work, but also provide a title, name, or licensors find the creators. keyword that sufficiently described the work in hopes The third diligent effort requirement was the use of that a potential licensor would consider the same title, appropriate technological tools, printed publications, name, or keyword when they search for the work. If and expert assistance when conducting a search for both the owner and the potential licensor consider the a copyright owner.102 This requirement opened the same terms, the likelihood of a successful search of reasonable search criteria for a potential licensor beyond the Copyright Office’s public catalog becomes more that of the Copyright Office’s resources. Resources like reasonable. While such searches often prove to be internet search engines, address directories, telephone fruitless, registering with the Copyright Office would directories, and even ownership information appearing increase the likelihood that a potential licensor would on the orphan works themselves were potential areas find the creator of a work. Taking such an opportunity requiring reasonable search before limitations could would result in either a potential licensor finding the be placed on the liability of a copyright infringer.103 owner or a court finding that a diligent effort was not The growth of high-speed internet, e-mail, and search made by the infringer to try to locate the owner, thus engines has potentially made it much easier for a securing a plethora of monetary and injunctive relief rights-holder to be found.104 If a potential licensor for the rights-holder. was required to use the internet to search for the The second diligent effort requirement was a owner of an orphan work, there would be impetus for search of sources of copyright ownership, authorship a work owner to then put their work online. Online information, and if possible, licensor information.97 publication is not required by any statute or regulation, While this search was limited to sources reasonably but it would increase the likelihood of finding that the available to the potential licensor, the criterion owner of any copyrighted work. This requirement is did encapsulate a plethora of potential sources of not limited to online publications. The requirement to information. This search requirement included the search printed publications could lead to the growth of Copyright Card Catalog at the Library of Congress.98 copyrighted works directories, potentially functioning In addition, the vagueness of the definition of “source like the Copyright Office Card Catalogue. While of copyright authorship and information” could the existence of such publications would not require have allowed the courts to impose numerous other rights-holders to place themselves and their works in potential searches of information sources upon a the publication, such opportunities could have given licensor, dependent upon the facts of the case. The creators the best chance of retaining all of their rights Copyright Office even predicted that orphan works to monetary and injunctive relief. Should individuals legislation would develop privately owned and operated become experts in locating the rights-holders of orphan sources of copyright authorship information.99 If works, would it not also be prudent for the creators such sources appeared, one source, if not more, could of orphan works to make themselves known to such become de facto components of a diligent search for experts? Owners should at least associate themselves potential licensors.100 The growth of private sources of with or publish themselves within the resources used by copyright information and the possible creation of de those experts so that licensors can identify them. facto components would lead to creators and copyright The fourth diligent effort requirement was the most owners finding included indentifying information controversial. This criterion told potential licensors to within those sources. By encouraging a rights-holder make “use of appropriate databases, including databases that are available to the public through the Internet.”105 96. See Tehranian, supra note 17, at 1430-31 (acknowledging that search reports from the U.S. Copyright office will be non- interpretive and search criteria may not accurately identify the work 101. Publication has not been a requirement for copyright or owner sought out). protection since the enactment of the Copyright Act of 1976 on 97. S. 2913 § 2(b)(2)(A)(ii)(I)(bb) January 1, 1978. Copyright Act of 1976, Pub. L. No. 94-553, 90 98. Circular 23: The Copyright Card Catalog and the Online Stat. 2541 (1976) Files of the Copyright Office 1 (Nov. 2010), available at http://www. 102. S. 2913 § 2(b)(2)(A)(ii)(I)(cc). copyright.gov/circs/circ23.pdf 103. U.S. Copyright Office, supra note 3, at 77-78. 99. U.S. Copyright Office, supra note 3, at 103-04. 104. Id. at 104. 100. Id. 105. S. 2913 § 2(b)(2)(A)(ii)(I)(dd).

American University Intellectual Property Brief 49 Informal Formalities

This requirement acknowledged the potential faults of located along with their work. the Copyright Office Registry, in that a search of the The fifth and final explicit requirement of a diligent registry may not provide sufficient results.106 Instead, search was the performance of actions deemed to be the federal legislators preferred to release a potential “reasonable and appropriate” under the circumstances tidal wave of databases upon rights-holders and of the search.115 This last criterion was the one piece licensors.107 The Copyright Office even acknowledged of hope for a rights-holder. If a potential licensor, that the operation of a singular registration system or during the completion of any of the four minimum database would be cost ineffective.108 The existence requirements for a diligent search, located any of a singular copyright database or registry could also information about who may own the rights to a work lead to disagreements between system administrators that information could force the licensor to continue and rights-holders choosing to enter their work in the his search until the investigation has come to a fruitful database, as rights-holders may believe that the database end.116 Once the five requirements of the diligent is unable to provide the sufficient resources to chronicle search were met, however, that did not mean that the and document the work.109 Instead, the Copyright potential licensor, or the owner, was free to do as they Office suggested that multiple registries would solve please. the orphan works problem, and the fourth requirement The Shawn Bentley Orphan Works Act of 2008 encapsulated all those databases in the reasonable also created “recommended practices” for potential search.110 These would most likely have been private licensors. The recommended practices were intended registries, as the private market has better capabilities to be the ongoing contribution of the United States to market their products to potential rights-holders and Copyright Office to fix the orphan works problem.117 desired licensors.111 While the Copyright Office and The Copyright Office noted that potential users legislators desired to distance themselves as much as desired guidelines to follow when searching for works possible from mandatory registration requirements,112 and owners in different mediums.118 Recommended they still required the search of registries by those practices would allow the Copyright Office to address looking to obtain licenses to exclusive rights.113 If the requirements of the diligent search with more copyright owners wished to protect their ability to specificity, guiding licensors to focus on particular receive full monetary and injunctive relief, they must criteria of the diligent search for different types of ensure that potential licensors found them. Placing works. The Copyright Office, with this requirement, their works in the databases described was a way to, could determine a de facto database to be explored or yet again, increase the likelihood of potential licensors tool to be used in order to meet the diligent search finding copyright owners. Take note that a potential requirement of S. 2913. The Copyright Office has licensor would mostly likely not meet the diligent investigated potential technologies and databases that effort requirement by simply searching one database, could have made their way into the “recommended but many.114 This leads one to believe that a creator practices,”119 further spelling out criteria for a diligent would have to register their work in multiple databases search and hinting at locations where copyright owners to facilitate their discovery. The legislation encouraged should make themselves and their works known to copyright owners to comply with more increasingly prevent their works from becoming orphans. With this burdensome steps to ensure that they are identified and power granted to the Copyright Office, the five criteria

106. See Tehranian, supra note 17, at 1430. 115. S. 2913 § 2(b)(2)(A)(ii)(II). 107. See U.S. Copyright Office, supra note 3, at 104-05. 116. U.S. Copyright Office, supra note 3, at 106 (holding 108. Id. (relying on their experience operating a registration that a reasonable search would entail efforts to identify, locate and database for copyrights, they understand a singular system entails make contact with any individuals associated with the work who are larger costs and burdens than most individuals fail to anticipate). probably not the legal owners of any right). 109. Id. (noting that the ambiguous scope of registrations, 117. See 154 Cong. Rec. S-3437-38 (daily ed. Apr. 28, 2008) paired with constant evolution in copyrighted works, may not (statement of Sen. Orrin G. Hatch) (noting that the disclosure of insure that information in the registry is an effective way of “best practices” for finding the owner of an orphan work will be the indentifying or cataloguing the work). contribution of the Copyright office, which the courts will make 110. Id. at 106 (“[W]e believe that registries are critically determinations as to if searches are diligent and in good faith). important, if not indispensible, to addressing the orphan works 118. U.S. Copyright Office, supra note 3, at 108. problem.”). 119. Promoting the Use of Orphan Works: Balancing the Interest 111. Id. of Copyright Owners and Users: Hearing before the Subcomm. on 112. See id. at 105 (acknowledging the traps caused by the Courts, the Internet, and Intellectual Property of H. Com. on mandatory registration systems). the Judiciary, supra note 42 (informing the committee of recent 113. S. 2913 § 2(b)(2)(A)(ii)(I)(dd). examination of products and databases from Copyright Clearance 114. See id.(requiring that a reasonable search be conducted Center, Digimarc, Google, InfoFlows, PicScout, PLUS, Audible does not limit the search to one database). Magic and Corbis).

50 Fall 2011 Mark Tratos of the diligent search were suddenly less reliable because would not change the allocation of damages at all. The the Copyright Office had the power to expand or only question is whether the Shawn Bentley Orphan define the reasonable search criteria at will. Following Works Act would have prevented a rights-holder from the roadmap in the statute would no longer be enough. receiving the profits attributable to the infringement. Lastly, the Act imposed a payment requirement. When a reasonable license fee is lost, there is guarantee The legislation informed the potential licensor that to receive profits,123 so it is unclear if rights-holders qualifying searches might require the use of databases would have lost much in actual damages under the or other technical resources that necessitate a payment Shawn Bentley Orphan Works Act. or subscription to use.120 While this element was Statutory damages are another story. An clearly directed at the potential user, there was nothing individual who previously registered their work with to indicate that the databases could not charge the the Copyright Office, in doing what orphan works individuals populating the database as well. Some legislation was trying to incentivize,124 stands to lose up rights-holders would no doubt be comfortable with to $150,000 per work in potential damages.125 Absent paying to ensure their exclusive rights stay intact, but this legislation and a lessening of liability, a court would others would most likely stay away from using a costly likely find a potential licensor’s use of an orphan work service. Would database owners find more revenue to be willful infringement, bringing up to $150,000 in charging the potential licensors who want to find the statutory damages.126 Obviously, judges in such cases rights-holders, or charging the rights-holders who just examine the totality of the circumstances to determine want to be found? It is not clear how this would have the appropriate award of damages, but losing a worked out, especially in the private sector, but when potential $150,000 because of orphan works legislation placed in the hands of unregulated sectors, the potential is a significant change from current copyright law. This ramifications should be noted. is especially important because statutory damages are While the intentions of the Shawn Bentley Orphan considered a reward for registering your work.127 Works of 2008 were grand, were they worth the risks Injunctive relief could be rendered non-existent for and potential harm placed upon rights-holders? The orphan works under this legislation as well. Section informal formalities were a dramatic development and 502 under current copyright law gives federal courts the the limitations on relief were possibly huge, but on a authority to grant reasonable injunctions to prevent or grander scale, what could have been the ramifications restrain the infringement of copyrights.128 This can be on copyright law? more important to the copyright owner than monetary VI. Ramifications on Current Copyright Law relief, as injunctive relief is the way for a rights-holder to protect the integrity of their work. However, under The Shawn Bentley Orphan Works Act of 2008 the orphan works legislation, that option is once again aimed to address the inadequacies of the U.S. copyright taken away from the copyright owners by the courts system, and while it did that, it challenged some long- asserting the payment of reasonable compensation.129 standing tenets of copyright law. From statute to The Shawn Bentley Orphan Works Act arguably case law to international treaty, everything was on the would have affected or eliminated Section 201(e) of cutting block to cure orphan works. The Act would have substantially affected monetary relief. As the Act made clear, the only 123. See On Davis v. The Gap, Inc. 246 F.3d 152, 167 (2d Cir. 2001) (“[D]ecisions of this and other courts support the view possible monetary relief available to a rights-holder was that the owner’s actual damages may include in appropriate cases “reasonable compensation” in the form of the market the reasonable license fee on which a willing buyer and a willing price for the license prior to the infringement.121 In seller would have agreed for the use taken by the infringer.”). current copyright infringement cases, reasonable 124. See 17 U.S.C. § 412 compensation to a copyright owner would be the 125. Id. § 504(c)(2); see 17 U.S.C. § 412. “actual damages suffered by him or her as a result of the 126. Id.; see Island Software & Computer Serv. v. Microsoft Corp., 413 F.3d 257, 263 (2d Cir. 2005) (holding that willful infringement, and any profits of the infringer that are infringement requires the defendant being aware that they were attributable to the infringement and are not taken into infringing another’s copyright). 122 account in computing the actual damages.” Prior 127. See Derek Andrew, Inc., 528 F.3d at 701 (holding that to S. 2913, when an infringer used an orphan work, because the plaintiff waited almost two years from the date of first courts would most likely consider the cost of the license publication to register its copyright, they should not receive the when the infringement occurred, so it appears the Act reward of statutory damages). 128. 17 U.S.C. § 502. 129. S. 2913 § 2(c)(2)(B) (“[A]ny injunctive relief ordered by 120. S. 2913 § 2(b)(2)(A)(v). the court may not restrain the infringer’s continued preparation or 121. Id § 2(c)(1). use of that new work, if the infringer pays reasonable compensation 122. 17 U.S.C. § 504(b). in a reasonably timely manner.”).

American University Intellectual Property Brief 51 Informal Formalities

Title 17 as well. Section 201(e) does not allow any be subject to the completion of some formality, the government body, official or organization to “seize, United States Congress has always been comfortable expropriate, transfer, or exercise rights of ownership treading a fine line between what is a formality and with respect to the copyright, or any exclusive rights what is not.134 The United States does not require an under copyright.”130 Under the orphan works individual to register their work to receive copyright legislation, the government, by granting “licenses” to protection, a belief that follows the Berne Convention’s potential users, would have exercised the right of the dicta; however, the United States does require copyright holder to grant licenses to all of the exclusive registration if one wants to bring an infringement rights under Section 106.131 Despite the fact that action or receive monetary relief for infringement in the the government ownership of copyrights is rare,132 form of statutory damages or attorney’s fees.135 While the Shawn Bentley Orphan Works Act would have the United States has always claimed our registration effectively allowed the government to act as if they system is valid in the face of international treaties, owned all the orphan works. requiring registration to enforce your copyright has A changing of Section 201(e) leads directly to a been deemed by some to have the same effect as forcing potential changing of the way we view Section 106. If registration for protection in the first place.136 The the government can give any of the Section 106 rights Shawn Bentley Orphan Works Act of 2008 could have to a potential licensor without the owner’s consent, further complicated this scenario by necessitating the does the owner really have exclusive rights? It is also registration of your work with not only the Copyright unclear what rights a potential licensor would have Office, but also with other private databases and been allowed to take as well. The right to create a directories.137 Not doing so would lead to the potential derivative work is clearly at the heart of the orphan loss of your exclusive rights to copyright.138 While works matter, but could it extend to the granting of still most likely falling in line with the United States’ a license to simply reproduce the work in the same rationale that current registries can still function in manner as it was originally produced? It is unclear the wake of Berne and other international agreements, how the courts would handle such a scenario, and this scenario does add more ammunition to the until orphan works legislation is passed, it will remain argument that coerced registration could function as unclear. a true formality. The ramifications of orphan works One of the rights not represented in Section 106, legislation have been noted and there is no doubt that but that is no less vehemently fought for amongst they played a part in this legislation’s demise. The next copyright owners, is the “right to exclude.” The question is how bodies other than Congress would treat right to exclude anyone from licensing has long been solutions to the orphan works problem. 133 viewed as one of the rights of a copyright owner. VII. Reactions This legislation would perhaps change the way that we approach copyright, changing copyright from a The ideologies on the two opposite sides of the property right into something entirely different. orphan works legislation have been battling for a few Finally, the Shawn Bentley Orphan Works Act years now. It could be argued that the rights-holders of 2008 arguably stood in the way of the Berne are “winning” the battle, as legislation has not passed Convention and what it was trying to accomplish, both houses of Congress, but that also means that along with many other international copyright treaties. the orphan works problem has been allowed to grow Despite establishing that “the enjoyment and exercise” exponentially for additional years without a legislative of all rights associated with copyright protection cannot solution. There was, however, a recent attempt at a private solution.

130. 17 U.S.C. § 201(e). 131. 17 U.S.C. § 106 (transferring the exclusive rights to 134. See Tehranian, supra note 17, at 1438-39 (holding reproduce the copyrighted work, to prepare derivative works, to that copyright registration is not a formality when it only affects distribute copies of the work, to perform the work publicly, to copyright remedies and not copyright subsistence). displace the work publicly). 135. 17 U.S.C. § 411-12. 132. See 17 U.S.C § 105 (denying copyright protection 136. See Tehranian, supra note 17, at 1439 (noting that for any work of the United States Government); see Schnapper v. copyright owners who did not register their work previous to Foley 667, F.2d 102 (D.C. Cir. 1981) (allowing the government to infringement are often left to extralegal means to reverse the acquire ownership of copyrights). infringement, thus eliminating the legal effect of having copyright 133. Fox Film Corp. v. Doyal, 286 U.S. 123, 127 (1932) protection). (noting that Article 1, Section 8, Paragraph 8 of the United States 137. S. 2913 § 2(b)(2)(A)(ii) (requiring potential licensors to Constitution granted the right of an author to license their work, search various databases and directories as required under reasonable which in turn allows for the owner of a copyright to refuse to circumstances). license their work). 138. See S. 2913 § 2(b)(3).

52 Fall 2011 Mark Tratos

In 2004, the Google Corporation undertook works without seeking permission.149 In addition, the a project to digitally copy books and other written judge found it to be very unlikely that most copyright works, with the eventual purpose that Google users owners would actually know to come forward to could search through a book’s text online, amongst enforce their copyrights by removing their works from other goals.139 The project was met with a great deal the registry.150 The court also held that the agreement of resistance from publishers and rights-holders.140 would have a massive impact on foreign rights-holders, Eventually an agreement was reached between the who would most likely find it more difficult to receive Author’s Guild and Google allowing Google to notification of what they must do to protect their work continue the digitizing books, sell subscriptions to than it would be for U.S. rights-holders.151 Judge Chin an electronic books database, sell access to individual finally took note that foreign digital libraries, which books, and to make other prescribed uses.141 The are in line with international treaty agreements, would settlement would have created a registry of all the not receive control over orphan works that Google was rights-holders of the works scanned in the Google trying to obtain with the agreement.152 Books Project.142 Should the owner of the work choose While the first private attempt at a solution to not to have their previously digitally scanned work the orphan works problem failed in federal court, this used by Google or not to have their work digitized in does not mean that a legislative attempt at a similar the first place, they could have their book and/or their solution would not be successful. All the ruling does records removed from the registry.143 Although this is reinforce the basic concept that current copyright system seemed like a reasonable agreement amongst law will in no way provide for a solution to the orphan consenting parties, there was a great deal of contention works problem. Congress’s changes to copyright law regarding orphan works.144 While Google was required enabled the orphan works situation, and it is only when to use all reasonable efforts to find the owners of U.S. copyright law changes again that the problem the works,145 Google would, under the terms of the will disappear; the Shawn Bentley Orphan Works agreement, gain the rights to use the orphan works Act was an attempt at that change. The question is, unless the rights-holder purposefully opted out of the is the United States Congress ready to sacrifice many registry.146 of the current elements of copyright law to reach that While the Google Books agreement is not solution? The Senate was in 2008. Moreover, while completely analogous to the Shawn Bentley Orphan that attempt was meant to shape the actions to be taken Works Act, the similarities between the two scenarios by all copyright holders, that may not have been a bad are worthy to note. These similarities were not lost thing. In fact, it may have been the right solution for on the federal court judge in charge of approving or U.S. copyright law. denying the settlement, Judge Chin, either, who said VIII. The Shawn Bentley Orphan Works Act it has been the charge of Congress to further copyright 147 Would Have Been Good for the United policy. While the issue was in front of him however, States Copyright Market, and Thus Good he held that the Google Books settlement was not “fair, for the United States adequate, or reasonable.”148 Judge Chin held that it is inconsistent with the longstanding purpose of U.S. The Shawn Bentley Orphan Works Act of 2008 copyright law to force rights-holders to come forward was no doubt a controversial piece of legislation. This to protect their rights when Google first copied the controversy does not necessitate that the legislation be unsuccessful, does not attempt to incorrectly legislate, nor does it place the legislation outside of the “goals” of copyright law. In fact, the Shawn Bentley Orphan 139. The Authors Guild, 05 Civ. 8136, slip op. at 2-3. Works Act might have been the most successful attempt 140. Id. at 4. 141. Id. to get the United States back to what copyrights 142. Id. at 7-8. originally were meant to be and do in the United 143. Id. at 8. 144. Id. at 23-24 (holding that Congress has attempted to solve the orphan works problem, signifying it may not be the role or 149. Id. at 35. right of a private agreement to do so). 150. Id. at 35-36. 145. Id. at 9. 151. Id. at 43-44 (noting the concerns of foreign rights- 146. Id. at 32-34. holders that they are unable to accurately search the records of the 147. Id. at 23 (“The question of who should be entrusted Copyright Office without traveling to Washington, D.C. or paying with guardianship of orphan books . . . safeguards are matters more a fee of $330). appropriately decided by Congress than through an agreement 152. Id. at 45 (noting that the German digital library among private, self-interested parties.”). “Deutshe Digitale Bibliothek” must still license the rights of orphan 148. Id. at 1. works in order to use them).

American University Intellectual Property Brief 53 Informal Formalities

States.153 that when the public’s interests and the interests of the The solution to the orphan works problem is to artist were to conflict, the interests of the public were of make every rights-holder locatable when an individual greater priority.158 wishes to license the work. It seems clear that the Such favoritism of copyright formalities in our legislation, with its imposition of informal formalities, legislative past shows that the United States was would have done that. Individuals could license never a nation that treated a copyright as a natural orphan works under certain reasonable search criteria, right.159 One could assume that if a copyright were and that would in turn encourage current and future a natural right, created upon inception of a work, rights-holders to make themselves known to potential an individual would have to do nothing other than licensors. That is not what makes the legislation create the work to receive protection.160 Instead, the controversial though; what makes this legislation truly U.S. Government traditionally viewed copyrights novel and insightful are the requirements that rights- as a government-granted monopoly over the rights holders must satisfy to maintain their rights. Why associated with a work.161 It was the “thinkers” and should this be such a controversy though? The greater authors of treatises who instead believed in the “natural controversy might, in fact, be the changes to U.S. rights of authorship,” viewing formalities as hurdles in copyright law that led us to the problems in the first the path of that right.162 Therefore, while the “thinkers” place. and most Western European countries believed that The first copyright law in the United States was copyrights were natural rights,163 the United States a law populated with formalities to receive copyright continued to legislate and adjudicate that copyrights protection. The Copyright Act of 1790 gave copyright were government-granted monopolies, subject to the protection (the sole right and liberty of printing, strictest formalities.164 reprinting, publishing and vending) for 14 years to By acknowledging the United States’ rationale any individual who registered their work with the U.S. on copyright’s origins and what was required to government.154 To extend protection another 14 years, receive them, one can foresee the potential problems the rights-holder would have to renew their work with that the United States would have by eliminating the government again.155 The protection would never copyright formalities to fall in line with international be granted unless individuals deposited a copy of their conventions. The U.S. copyright system was based work with the government as well.156 From the birth of on the principle that someone must do more than this nation, copyright holders were expected to perform simply create the work to own a copyright in it. So certain actions to receive copyright protection. when Congress decided to retreat from that principle, The belief that formalities were beneficial and problems arose, the most significant being orphan necessary for copyright protection was held firm in works. Recognizing this problem, Congress attempted U.S. law until the implementation of the Copyright to re-impose the formalities through the creation of Act of 1976 and the Berne Convention, which informal formalities in the Shawn Bentley Orphan eliminated copyright formalities from U.S. copyright Works Act. Forced to function in between U.S. law. Even as the United States moved away from copyright principles and international beliefs, orphan copyright formalities, it does not appear that was ever the true intent of the Copyright Office. The Register author, but primarily for the benefit of the public, such rights are of Copyrights did not approve the instant granting of given.”). copyright protection when Congress looked to revise 158. See id. copyright law in the 1970s.157 The Register believed 159. See id. at 319 160. See id. at 318-19 (noting that the imposition of formalities reflects the concept that creating a work alone does not 153. See U.S. Const. art. 1, § 8, cl. 8 (noting that the justify protection). copyright clause is not meant to benefit individual people, but “to 161. See id. (holding that a government-granted monopoly promote the Progress of Science and useful Arts” for the people). would most likely require the copyright holder to meet certain 154. Copyright Act of 1790, 1 Stat. 124 (protecting only requirements to receive the copyright). maps, charts, or books). 162. See id. at 320. 155. Id. 163. See also Circular 38A: International Copyright Relations of 156. Id. at 125. the United States, 1 (Nov. 2010) (noting that France, Germany, the 157. Ginsburg, supra note 11, at 333 (citing the Report of the United Kingdom, Italy, Portugal, and Spain agreed to the Berne Register of Copyrights on the General Revision of the U.S. Copyright Convention, and subsequent elimination of copyright formalities, Law (1961), available at http://en.wikisource.org/wiki/Report_ in the 19th century). of_the_Register_of_Copyrights_on_the_General_Revision_of_ 164. See Ginsburg, supra note 11, at 320-21 (recognizing the_U.S._Copyright_Law (“The Constitution does not establish that federal legislation and subsequent federal court decisions that copyrights, but provides that Congress shall have the power to grant enforced the “highly restricted view of copyright” that prevailed such rights if it thinks best. Not primarily for the benefit of the throughout the 19th century in the United States).

54 Fall 2011 Mark Tratos works legislation danced the fine line between freely emphasized the need for flexibility in defining what granting copyrights and asking owners to do more constitutes a reasonable search.170 By eliminating the than simply create. Orphan works legislation simply factors of a diligent search (records of the Copyright acknowledged that the United States has always treated office, technological tools, appropriate databases, etc.), copyrights differently than most of the world, and that Congress would encourage the development of new formalities, albeit informal, will be necessary. resources to find rights-holders instead of forcing those IX. The Next Step for Orphan Works Legislation resources to fall into specific categories. The elimination of the diligent search criteria could So where can we go from here? All attempts at also encourage the development of a more reasonable legislation have failed. It does not appear that another diligent search. The Report on Orphan Works attempt at solving the orphan works problem will acknowledged the prevalence of “private users” who be made in the current political climate. If another wished to obtain a license to use an orphan work.171 attempt were made though, some changes could make These private users would be the least likely to use the the solution more amiable for all. orphan work for commercial benefit and it could be A simplification of the proposed legislation could assumed that they also had limited funds to conduct a go far to increase the likelihood that orphan works diligent search. Such uses would harm rights-holders legislation would be passed. Referring back to the the least, and yet orphan works legislation still required proposed statutory language from the Copyright every potential user to complete every step of the Office’s Report on Orphan Works, the legislation diligent search. Despite the limited impact of private would call for a “reasonably diligent search to locate the users on the licensing market, the licensors would still 165 infringed copyright” when “performed in good faith.” be required to conduct ineffective searches of copyright There were no criteria for specialized databases to be records, occasionally paying Copyright Office staff to searched or for tools to be used, not even a mandatory conduct such a search in addition to potentially paying 166 search of the Copyright Office Registry. Instead, the for expert assistance or the right to use technological 167 legislation required only a diligent search. This could databases.172 Such monetary requirements would lessen the formalistic requirements placed on every still deter private users from appropriating orphan rights-holder while still encouraging preemptive actions works, and the deterrence of the least harmful uses to make themselves known to potential licensors. The of orphan works is antithetical to the purpose of the searches would still be required, and a possible loss of legislation.173 The elimination of diligent search criteria exclusive rights might occur, but no longer would the would no doubt facilitate the use of orphan works by rights-holders be told where their works should go. By private users, a goal that is supposedly the focus of this giving creators more control over their own works and legislation.174 how they are to make themselves known to the world, Finally, instead of mandating specific search rights-holders are given more freedom to protect their criteria for a potential licensor175, future legislation works as they see fit. All that would be required to should address the factors that courts would use to accomplish this is a simplification of the legislation’s language. By not statutorily defining the criteria for a 170. U.S. Copyright Office, supra note 3, at 104. diligent search, Congress would not be limiting itself 171. Id. at 125. (noting the prevalence of individuals wishing to specific ways that potential licensors could find to reproduce old family photographs). 172. S. 2913 § 514(b)(2)(A)(ii) (requiring searches of the the owners of works. The Report on Orphan Works records of the Copyright Office, technological databases, and the spoke of the rise of new tools to identify and protect use of expert assistance to conduct a reasonable search). 168 works ; however, the Shawn Bentley Orphan Works 173. See U.S. Copyright Office, supra note 3, at 38-40 (noting Act attempted to require the use of these tools before that small-time users would might be willing to pay small fees to it was known what tools would prove useful in the first use a work, but only if it would ensure finding the owner of the place169. The Report on Orphan Works frequently copyright). 174. U.S. Copyright Office, supra note 3, at 8 (asserting that the first goal of orphan works legislation was to create a system that 165. U.S. Copyright Office, supra note 3, at 127. would make it more likely for users to find a relevant rights-holder 166. Id. and negotiated a license agreement and recognizing that the second 167. Id. goal was to encourage use of orphan works only when the rights- 168. Id. at 104 (noting that the growth in technology, holder could not be found). particularly internet based technology, would factor into what 175. See id. (requiring that every diligent search entail a search qualified as a reasonable search as it would be much easier to of the records of the Copyright Office, as search of available sources identify and locate authors). of copyright authorship, the use of appropriate technological 169. See S. 2913 § 514(b)(2)(A)(ii)(requiring specific steps to tools while searching, and the use of appropriate databases while be taken to qualify as a diligent search). searching).

American University Intellectual Property Brief 55 Informal Formalities determine if a reasonable search actually occurred. The of a reasonably diligent search, a more flexible, and Report on Orphan Works acknowledged that what is a therefore workable, standard will be created. Such a reasonable search in certain circumstances might not be standard will assuage the fears of rights-holders and a reasonable search in others.176 The reasonability of a make orphan works legislation easier to pass, all the search would often depend on numerous factors, which while accomplishing the goals of previous orphan works would have to be balanced by the courts.177 Arguably, legislation. the most important factor to determine reasonability is X. Conclusion the nature and extent of the use.178 The Report stressed that the more commercial the use of an orphan work There seems to be unanimous agreement that by the potential licensor, the greater the effort the orphan works are a devastating problem for copyright licensor must expend in finding the rights-holder.179 law; however, there is no agreement as to what should This factor will truly protect the rights-holder, as the be done about them. The most recent legislative potential licensor’s search for rights-holders, while attempt at fixing that problem, the Shawn Bentley intending to profit, would be scrutinized for good faith Orphan Works Act of 2008, was novel, but by creating and diligence. Orphan works legislation must focus informal formalities, the bill might have been doomed upon this factor in order to persuade rights-holders that from the start. When you look at the beginnings of they will be sufficiently protected from licensors who copyright protection in the United States though, stand to benefit from attempting to skirt the reasonable the idea behind informal formalities seems to fall search requirements, or those licensors who perform in line with the country’s goals. The United States, the bare minimum when conducting the search. through legislation and common law, has always Instead of establishing strict diligent search criteria for treated a copyright as something that is earned, not the licensor, orphan works legislation should establish freely given. It is with this goal in mind that Congress statutory factors that courts will use to determine the must continue to shape its orphan works legislation, reasonability of the search, with the nature and extent perhaps by eliminating search criteria and instead of the use being the most influential. Such a statutory creating factors for courts to use in determining what construction has proven to be effective in the past, with constitutes a reasonable search. By taking these actions, federal courts embracing and shaping the four factors Congress may be able to eliminate orphan works and of copyright fair use.180 By giving the courts factors establish the copyright license market as a functional that would shape what constitutes a reasonable search part or our national economy. instead of strictly defining it, the legislation could be friendlier to both parties involved. The private users who wish to license orphan works would, in theory, not be forced to waste money on costly and ineffective searches. The rights-holders should, in turn, be able to make themselves known as much or as little as they would choose. They could choose to identify themselves everywhere, likely increasing that odds that every licensor would find them, or they could choose to put themselves in only a few small places, hopefully allowing those who truly wished to profit off their work would find them, letting the private users with limited means use the orphan work freely. This flexibility is essential for orphan works legislation to succeed. By simplifying orphan works legislation and replacing the diligent search criteria with the factors

176. U.S. Copyright Office, supra note 3, at 98. 177. Id. at 98-108 (holding that the reasonability of a search would be shaped by identifying information on the work itself, the public nature of the work, age of the work, whether indentifying information exists in publically available records, and the status of the author). 178. See id. at 107-08. 179. See id. 180. See 17 U.S.C. § 107.

56 Fall 2011 Joshua M. Green The Russian IPR Problem:How Accession to the WTO is Not the Magical Solution, Rather a Step in the Right Direction by Joshua M. Green*

I. Introduction Furthermore, the highest burden is carried by G20 countries, which lose billions annually because of International failures to enforce and protect 5 intellectual property rights (IPRs) have a lasting counterfeiting and piracy. These figures include impact on economic growth,1 consumer safety,2 and billions in lost tax revenues, billions of increased even national security.3 These failures are costing welfare spending, “$25 billion in increased costs of companies and consumers billions of dollars annually.4 crime, $18.1 billion in the economic cost of deaths resulting from counterfeiting, and $125 million for * Joshua M. Green is a graduate of Gonzaga University the additional cost of health services to treat injuries 6 School of Law. caused by dangerous fake products.” Needless to 1. See Frontier Economics, Estimating the Global Economic say, bolstering worldwide IPR enforcement would and Social Impacts of Counterfeiting and Piracy, 6, 9 (Feb. 2011) plausibly save G20 countries billions of dollars every (commissioned by Business Actions to Stop Counterfeiting 7 & Piracy (BASCAP)), available at http://www.iccwbo.org/ year and should be a top priority for every nation. uploadedFiles/BASCAP/Pages/Global%20Impacts%20-%20Final. However, counterfeiting and piracy continue to be an pdf; see also International AntiCounterfeiting Coalition international problem.8 , Submission of the International AntiCounterfeiting Every year the U.S. Trade Representative publishes Coalition to the United States Trade Representative: a report detailing the failures of other nations in Special 301 Recommendations, 4 (Feb. 11, 2011) [hereinafter 9 IACC] https://www.law.stanford.edu/display/images/dynamic/ enforcing IPRs. In the Trade Representative’s latest events_media/IACC%202011%20Special%20301.pdf (concluding report, the Russian Federation topped the list as one of that “the global scale of counterfeiting and piracy estimate the total the biggest infringing nations, second only to China.10 global value of counterfeit and pirated products to be US$455- Indeed, Russia has been a leading infringer for quite 650 billion each year, with the projected annual global value of some time.11 Much scholarly attention has addressed counterfeit and pirated products to exceed $1 trillion by 2015”). 2. See e.g., 8 Arrested for Selling Counterfeit Rabies the challenges international trade organizations place Vaccine, Desk Of Brian, Sept. 27, 2010, http://deskofbrian. on developing nations, which in turn makes regulating com/2010/09/8-arrested-for-selling-counterfeit-rabies- vaccine/?utm_source=rss&utm_medium=rss&utm_campaign=8- arrested-for-selling-counterfeit-rabies-vaccine (revealing that eight Tech Products, Bloomberg Businessweek, Mar. 1, 2010, people were arrested for selling fake rabies vaccine which killed http://www.businessweek.com/technology/content/feb2010/ one and endangered over a thousand); Martin Cassidy, Trading tc20100228_486251.htm. Standards Issues Counterfeit Brake Pads Warning, BBC, Aug. 2, 2010, http://www.bbc.co.uk/news/uk-northern-ireland-10846035 5. See IACC, supra note 1, at 5. (detailing counterfeit brake pads in Northern Ireland that failed 6. Id. friction tests and were held together by glue); Former Bellevue Salon 7. See id. Owner Sentenced for Fake Botox Injections, Seattle Pi, Jan. 15, 8. See Office of the U.S. Trade Representative, 2011 2010, http://www.seattlepi.com/sound/414309_sound81776672. Special 301 Report 25 (April 30, 2011) http://www.ustr.gov/webfm_ html (reporting inflammation, swelling, and hardening of patients send/2841. faces after receiving counterfeit Botox and Restylane injections, 9. See id. causing one woman to undergo plastic surgery); Leslie Meredith, 10. See id. at 19-24. Counterfeit Phones May Explode, TechNews Daily, Sept. 28, 11. In fact, Russia has been second to China on the Priority 2010, http://www.technewsdaily.com/counterfeit-phones-may- Watch List since at least 2007. See generally, Office of the U.S. explode-1339/ (detailing twenty hospitalizations and one death in Trade Representative, 2010 Special 301 Report, (April India due to recent counterfeit cell phone explosions). 30, 2010) http://www.ustr.gov/webfm_send/1906; Office of the 3. See e.g., Grant Gross, U.S. Agencies Crack Down on U.S. Trade Representative, 2009 Special 301 Report, (April 30, Counterfeit Networking Hardware, PCWorld, May 6, 2010, http:// 2009) http://www.ustr.gov/sites/default/files/Full%20Version%20 www.pcworld.com/article/195791/us_agencies_crack_down_on_ of%20the%202009%20SPECIAL% 20301%20REPORT.pdf; counterfeit_networking_hardware.html (describing how Ehab Office of the U.S. Trade Representative, 2008 Special 301 Ashoor, a Saudi citizen who purchased counterfeit Cisco Gigabit Report, (April 30, 2008) http://www.ustr.gov/sites/default/files/ Interface Converters, was sentenced for intending to sell them to asset_upload_file553_14869.pdf; Office of the U.S. Trade the U.S. Marines for use in transmitting troop movements, relaying Representative, 2007 Special 301 Report, (April 30, 2007) intelligence, and maintaining security at a military base in Iraq). http://www.ustr.gov/sites/default/files/asset_ upload_file230_11122. 4. See Rachael King, Fighting a Flood of Counterfeit pdf.

American University Intellectual Property Brief 57 The Russian IPR Problem

and enforcing IPRs extremely difficult.12 However, regulation and enforcement of IPRs in the Russian there is little dispute that there is a problem in Russia Federation? If China, which shares many geographical, with guaranteeing protection of international IPRs political, and socio-economic similarities with Russia, within their borders,13 which has the potential to affect is an indication of what is to come, accession into the the Russian Federation’s economic development in the WTO will have little impact on the staggering IPR future.14 infringement problem the Russian Federation faces, The World Trade Organization (WTO) has especially at first.18 the most comprehensive and extensive series of This article will address the international IPR international agreements, including the Trade Related implications of Russia joining the WTO. Section Aspects of Intellectual Property Rights agreement II provides a background of current Russian laws as (TRIPS),15 which has been somewhat effective in well as a brief history of the government’s efforts to regulating IPRs in member nations and has helped conform to world IPR enforcement standards. Section to improve the overall enforcement of IPRs in lesser- III it addresses the challenges the Russian Federation developed countries.16 However, Russia is not a faces against the backdrop of China’s progress as a member of the WTO, although they are members of neighboring nation that shares many of its limitations. other international intellectual property agreements Finally, section IV suggests practical changes for the and are taking steps to win accession into the WTO.17 WTO and Russia, which could make the Russian One glaring question has emerged from discussions Federation’s transition quicker, smoother, and more regarding Russia’s imminent membership in the effective. WTO: will Russia’s accession to the WTO and II. Background more particularly TRIPS have any real impact in the A. History of Russian IP Laws Leading Up to 12. See Beatrice Lindstrom, Scaling Back TRIPS-Plus: An Analysis of Intellectual Property Provisions in Trade Agreements Contemporary IP Law and Implications for Asia and the Pacific, 42 N.Y.U. J. Int’l L. & The Russian Federation has been trying to win Pol. 917, 944 (2010) (noting that compliance with TRIPS costs 19 20 developing countries $60 billion per year); see also Darya Haag, accession into the WTO since 1993. Until recently, Time to Pay the Dues or Can Intellectual Property Rights Feel Safe the U.S. had blocked all efforts by Russia to join the with the WTO?, 8 Rich. J. Global L. & Bus. 427, 437 (2009) WTO community because of their failures to protect (addressing arguments “that an imposition of costly minimum U.S. IPRs.21 Unlike U.S. intellectual property law, which standards deprives [developing countries] of finances necessary can trace its roots back to Article I, Section 8 of the for medicine, education and the development of infrastructure”); 22 Paulina Rezler, Breaking Through the Great Wall: Problems of Constitution, the history of Russian IP protection has 23 Enforcement of Intellectual Property Rights in China, 14 Touro a blemished past. Prior to the Communist Revolution Int’l L. Rev. 194 (2010); Candace S. Friel, The High Cost of in 1917, Russia’s protection of IPRs was actually on par Global Intellectual Property Theft: An Analysis of Current Trends, The with the rest of the world.24 TRIPS Agreement, and Future Approaches to Combat the Problem, 7 Wake Forest Intell. Prop. L.J. 209 (2007) (noting some of the problems with TRIPS and other international agreements). 18. See China has been a member of the WTO since 13. See Leah Dow, Russia Tackles Intellectual Property Piracy, November 10, 2001. Press Release, World Trade Organization, But More Work Needed, America.Gov Archive (May 4, 2009) WTO Ministerial Conference Approves China’s Accession, http://www.america.gov/st/business-english/2009/May/200905 (November 10, 2001) available at http://www.wto.org/english/ 04182236SBlebahC0.0366894.html; Janet L. Hoffman, Denis news_e/pres01_e/pr252_e.htm. Regardless of their 10 year tenure Khabarov & Tom Thomson, Navigating the Russian Legislative Maze as a WTO nation, they still remain at the top of the U.S. Trade (Feb./Mar. 2010) http://www.cipr.org/files/WTR_Feb_Mar_10.pdf. Representative’s priority watch list. See Office of the U.S. Trade 14. See Intellectual Property Rights: A Key to Russia’s Economic Representative, 2010 Special 301 Report, (April 30, 2010) Revival, The Coalition for Intellectual Property Rights, http://www.ustr.gov/webfm_send/1906. http://www.cipr.org/activities/articles/RBWipr.pdf (last visited Sept. 19. See Esprit Eugster, Evolution and Enforcement of 13, 2011). Intellectual Property Law in Russia, 9 Wash. U. Glob. Stud. L. Rev. 15. See Agreement on Trade-Related Aspects of Intellectual 131, 150 (2010); World Trade Organization, Accessions: Russian Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing Federation,://www.wto.org/english/thewto_e/acc_e/a1_russie_e.htm the World Trade Organization, Annex 1C, Legal Instruments-- (last visited Sept. 14, 2011). Results of the Uruguay Round, 1869 U.N.T.S. 299, 33 I.L.M. 20. See Steve Gutterman, Update 1- U.S. Vice President 1125 (hereinafter TRIPS Agreement) available at http://www.wto. Biden Backs Russia WTO Bid, Reuters (March 9, 2011) org/english/docs_e/legal_e/legal_e.htm. http://www.reuters.com/article/2011/03/09/russia-usa-biden- 16. See World Trade Organization, Least Developed idUSLDE7281LC20110309. Countries’ Needs in Intellectual Property: Key Developments, Nov. 4, 21. See Eugster, supra note 19, at 132. 2011, http://www.wto.org/english/tratop_e/trips_e/ldc_e.htm. 22. See U.S. Const. art. 1, § 8. 17. See World Trade Organization, Status of Accession 23. See Eugster, supra note 19, at 136-151 (chronicling the Working Party, (last visited Sept. 13, 2011) http://www.wto.org/ history of intellectual property laws in Russia). english/thewto_e/acc_e/a1_russie_e.htm. 24. See id. at 136.

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However, with the rise of the Soviet era, Russia’s essentially replaced all prior IP laws, much of the concept of property changed drastically and, preexisting provisions were incorporated into the new unsurprisingly, notions of intellectual property rights legislation.36 Although the amendments were accepted changed with it, albeit not immediately.25 By 1931, and signed into law with little public debate,37 the new IPRs under Soviet rule devolved into nonexistence— legislation established a framework of IP laws that meet the new laws abolished private ownership of intellectual the international standards established by TRIPS.38 26 property. IPRs did not receive any national attention 1. Trademarks again until 1991, spurred by the cultural and political paradigm shift under President Mikhail Gorbachev’s When President Putin signed Part IV of the economic, ideological, and social reforms of the mid Russian Civil Code into law on December 19, 2006, 1980s.27 Actual legislative changes did not surface many questions regarding trademark protection still 39 until 1992, when the new republican government of remained. For example, some questioned the absence the Russian Federation enacted a series of intellectual of a uniform infringement standard, the insufficient property laws.28 Between 1994 and 2004, Russia’s protection of famous and other well-known marks, legislative body enacted a host of laws that would directly the absence of opposition procedures, and the lack regulate trademarks, copyrights, patents, and even trade of transparency at Rospatent, Russia’s version of the 40 secrets.29 United States Patent and Trademark Office (USPTO). However, despite the controversy, Part IV made few B. Part IV of the Russian Civil Code: A New substantive changes with regard to trademarks. 41 Day of IP Protection Contrary to the many concerns that nations and In 2006, the Russian Federation proposed and businesses had about the 2006 law, Part IV complies with 42 adopted Part IV of the Russian Civil Code,30 a hotly TRIPS requirements and actually mirrors the Lanham 43 controversial piece of legislation,31 which amended and Act on many provisions. For example, Part IV has a 44 essentially replaced the existing intellectual property similar definition of trademarks and service marks, 45 laws.32 The 2006 legislation was largely a knee-jerk provides legal protection for registered marks, lays out 46 reaction to the vast amount of negative national attention the rights of trademark holders, establishes statutory the Federation was receiving regarding its IP laws.33 It was also an effort by the Federation to finally win accession into the WTO.34 The new legislation appeared to satisfy 36. See id. at 8; Eugster, supra note 19, at 145. the U.S., which, up until that point, had vigorously 37. See Barannikova, supra note 31 (noting that the new opposed Russia’s admission into the WTO.35 legislation “appeared like a bolt out of the blue. None of the organizations that had been working on this issue with the Even though Part IV of the Russian Civil Code government had seen the draft or even known of its preparation until it” was proposed to the Duma); Russia Proposes New Civil Code, Coalition for Intellectual Property Rights, (March 25. See id. at 137. 2006) http://www.cipr.org/activities/advocacy/civil_code/index.htm 26. See id. at 136. (stating that there were concerns “because the draft legislation was 27. See id. not the subject of public discussion”). 28. See id. 38. See Budylin & Osipova, supra note 29, at 38 (concluding 29. See Sergey Budylin & Yulia Osipova, Total Upgrade: that Part IV “corresponds to the current international standards and Intellectual Property Law Reform in Russia, 1 Colum. J. E. Eur. L. treaties, and can be tentatively characterized as ‘WTO-ready’”). 1, 4 (2007) (reviewing the history of Russian IP legislation after the 39. See Part IV of the Russian Civil Code: Summary of Key collapse of the Soviet Union). Trademark Protection Issues, Coalition for Intellectual 30. See Eugster, supra note 19 at 145. Property Rights, http://www.cipr.org/activities/advocacy/files/ 31. See Russia Proposes New Civil Code, Coalition for CIPR_PartIVSummary_12-06.pdf (last visited Sept. 13, 2011). Intellectual Property Rights, (March 2006) http://www.cipr. 40. See id. org/activities/advocacy/civil_code/index.htm; see also Part IV of the 41. Pavel Sodovsky, Part IV of the Civil Code: A Mixed Russian Civil Code: Summary of Key Trademark Protection Issues, Blessing, AEB Bus. Quarterly No. 4 (2007), available at http:// Coalition for Intellectual Property Rights, http://www.cipr. www.magisters.com/publication.php?en/592/articles/. org/activities/advocacy/files/CIPR_PartIVSummary_12-06.pdf 42. See TRIPS Agreement, supra note 15, at art. 15. (last visited Sept. 13, 2011) (highlighting the key trademark issues 43. Compare Law of the Russian Federation On in the new law even after they were enacted); Olga Barannikova, Trademarks, Service Marks and Appellations of Origin An Intellectual Property Rights Headache, Moscow Times (March English translation available at http://www.liapunov.com/legislation- 14, 2006), http://www.cipr.org/activities/publications/intellectual_ tm.html, with 22 U.S.C. §1051 et seq. property_rights/index.htm. 44. See Law of the Russian Federation on Trademarks, 32. See Budylin & Osipova, supra note 29, at 8. Service Marks and Appellations of Origin, supra note 43, at 33. See id. at 2. art. 1. 34. See id. at 3. 45. Id. at art. 2. 35. See id. 46. Id. at art. 4.

American University Intellectual Property Brief 59 The Russian IPR Problem

bars to registration,47 and clearly establishes a system law-enforcement practice in Russia.”58 To be sure the for registration.48 Trademarks can be denied if they are level of protection extended to copyright holders is on confusingly similar to “a company name, commercial the rise and this should be cause for encouragement.59 designation, or a domain name that is already protected The laws currently in place securing authors in their in the Russian Federation.”49 In fact, the new features intellectual property rights is currently on par with the that Part IV incorporated into its trademark statutes WTO and other nations, including the United States.60 were mostly procedural, although Part IV also expanded It also shows that Russia is firmly committed to the notions of trademark use and introduced new sanctions.50 legislative protection of intellectual property rights.61 In totality, the trademark provisions are actually rather 3. Patents complete. Russia’s patent laws under Part IV protect 2. Copyrights inventions, utility models, and industrial designs.62 It is The Russian Federation is already a member of the noteworthy that Article 1 protects each of the objects Berne and Rome Conventions.51 Although Russia is not contemplated in the Paris Convention63 and contains yet a member of the WTO, the copyright provisions very similar language to Section 5 of TRIPS.64 Until in Part IV were written with the TRIPS agreement recently, the patent laws in the United States granted in mind.52 From a copyright standpoint, the 2006 patent protection to the first to invent or conceive.65 legislation protects expressions of authorship “that are Congress recently passed legislation that placed the U.S. the product of creative work, regardless of the purpose, on par with the rest of the world,66 including Russia, by the merit and the manner of expression thereof.”53 This granting patent protection to the first party to file.67 A concept is similar to American provisions for copyright, patent will only be granted to those objects that are new which protect any “original works of authorship fixed or novel, which require an “inventive step,” and they in a tangible medium of expression.”54 Article 7 of the must be “industrially applicable.”68 These concepts are Russian Copyright statute has an almost identical list of strikingly similar to the U.S. counterpart, which requires protectable works as the list found in § 102 of the U.S. that inventions be novel, non-obvious, and useful.69 statute on copyrights.55 Furthermore, like in the United Conversely, discoveries, scientific theories, mathematical States, an author need not register to receive authors’ methods, aesthetic designs, business methods, and rights or neighboring rights.56 Even the duration of computer programming are not considered inventions copyright protection, life plus 70 years, emulates the and thus not patentable under Part IV.70 U.S. provision.57 Part IV formally establishes a meticulous method for The changes to previous copyright statutes in applying for a patent.71 As part of the application process, Part IV go a long way to protect authors and “will the applicant must disclose the patentee, clearly describe undoubtedly shape a new system of intellectual law and the invention so that it can be reduced to practice,

47. Id. at art. 6, 7. 58. Golovanov, supra note 51, at 8. 48. Id. at ch. 2. 59. See id. 49. Sodovsky, supra note 41; see also Law of the Russian 60. See Budylin & Osipova, supra note 29, at 38 (concluding Federation on Trademarks, supra note 43, at art. 7. that Part IV “corresponds to the current international standards and 50. See Sodovsky, supra note 41. treaties, and can be tentatively characterized as ‘WTO-ready’”). 51. Russia joined the Berne Convention in March of 1995 61. See Eugster, supra note 19, at 150. and later joined the Rome Convention in May of 2003 and 62. Patent Law of the Russian Federation at art. 1 the Universal Copyright Convention. See Dmitry Golovanov, [hereinafter Patent Law] English translation available at http://www. Transformation of Author’s Rights and Neigbouring Rights in Russia 3 liapunov.com/legislation-pat.html;); Budylin & Osipova, supra note (2008), available at http://www.obs.coe.int/oea_publ/iris/iris_plus/ 29, at 17. iplus2_2008.pdf. 63. Budylin & Osipova, supra note 29, at 17. 52. See id. 64. Compare Patent Law of the Russian Federation, supra note 53. Law of the Russian Federation On Copyright and 62, at art. 1,62, with TRIPS Agreement, supra note 15, at art. 5. Related Rights, art. 6, English translation available at http:// 65. See 35 U.S.C. § 102(g)(2) (1952). www.liapunov.com/legislation-co.html. 66. See, Press Release, US House of Representatives 54. 17 U.S.C. § 102(a) (1990). Committee on the Judiciary,Smith Patent Reform Bill Becomes 55. Compare Law of the Russian Federation on Law (Sept. 16, 2011) http://judiciary.house.gov/news/Patent%20 Copyright and Related Rights, supra note 53, at art. 7.1,53, Reform%20Law.html . with 17 U.S.C §§ 102(a)(1)-(8) (2006). 67. Patent Law, supra note 62, at art. 19. 56. See Golovanov, supra note 51, at 3. 68. Id. at art. 4. 57. Compare Law of the Russian Federation on Copyright and 69. 35 U.S.C. §§ 102, 103; U.S. Const. art. 1, § 8, cl. 8. Related Rights, supra note 53, at art. 27,53, with 17 U.S.C. 302(a) 70. See Patent Law, supra note 62, at art. 4.2. (2006). 71. See id. at tit. V.

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list the claims made by the patented object, include degree with China, which is the top infringer among drawings where necessary, and provide a synopsis.72 The all nations, despite being a member of the WTO.83 The application process, which is administered by Rospatent, two nations can be compared in terms of these shared permits patent applications to be filed by foreign limitations as well as their ability and willingness to nationals.73 Once a patent is granted, the patent holder zealously enforce IPRs. has an exclusive right to the invention, utility model, or A. Geographic Size industrial design.74 Part IV protects patent owners from infringement and grants them with a cause of action to Russia is the largest nation in the world with over stop infringement and to disgorge the profits resulting 17,098,242 square kilometers of terrain within its from infringement.75 boundaries.84 Most of this vast territory is harsh and The protections afforded to patent holders in under undeveloped and its over 138 million citizens are spread Part IV are robust and on par with the patent protections all across the nation.85 Furthermore, Russia shares a afforded in other TRIPS nations, including the United border with China, which remains the top manufacturer States. Russia has established a legal framework that of counterfeit goods.86 If the U.S. thinks it has a border parallels some provisions within Section 5 of the TRIPS problem with Mexico, it pales in comparison to the agreement.76 The protections extended to patent holders border problem between Russia and China, which meet the minimum standards established by the WTO is currently one of the longest borders in the world and should not hinder their accession in to the world stretching 3,645 km.87 This creates a custom officer’s organization. nightmare, where customs personnel are looking for a III. Discussion needle in a haystack. Similarly, China is the fourth largest nation by Given the trademark, copyright and patent area in the world with a population of over 1.3 billion provisions in Part IV, on paper Russia should be a decent people.88 Although it is slightly smaller geographically candidate to be the next member of the WTO. However, than the United States, its population is almost three the Russian Federation’s problem stems not from a lack times as large.89 Millions of people are packed into the laws, but a lack of enforcement.77 Despite new laws large cities, with many more spread out across the vast and increased raids, piracy in Russia still continues to Chinese landscape.90 The size of the country combined grow.78 U.S. losses resulting from Russian piracy totaled with the population is overwhelming. Effective IPR nearly 2 billion dollars in 2006 when Russia passed Part enforcement in this environment is nearly impossible as IV and 1.4 billion dollars in 2010.79 According to the is evident from China’s track record. International Anti Counterfeiting Coalition (IACC), Russia has been making positive customs the sale of counterfeit goods accounted for 24% of improvements through their 2010 Customs Union the retail goods sold in key product sectors in Russia with Belarus and Kazakhstan, which hopes to increase in 2009.80 Although Russia has improved its efforts in enforcement against counterfeit goods.91 Presently, the combating infringing activities, these efforts have not current customs operation in regard to the Chinese had a meaningful impact on curtailing piracy.81 border is a huge concern.92 Efforts have been made by Some argue that the reason Russia is not seeing any both countries to improve their customs agents’ ability improvement is the lack of criminal prosecutions against to identify and seize counterfeit goods.93 These efforts are those caught trafficking pirated goods.82 However, Russia has a host of unique geographic, socioeconomic, 83. 2011 Special 301 Report, supra note 8, at 19. and political limitations, which make IPR enforcement 84. Central Intelligence Agency, Russia World Factbook, very difficult. These limitations are also shared to some https://www.cia.gov/library/publications/the-world-factbook/geos/ rs.html (last visited May 7, 2011). 85. Id. 72. Id. at art. 16.2. 86. IACC, supra note 1, at 37. 73. See id. at art. 15. 87. Li Xiaokun, China, Russia Sign Border Agreement, 74. Id. at art. 10.1. China Daily, (July 7, 2008) http://www.chinadaily.com.cn/ 75. Id. at art. 14.2. china/2008-07/22/content_6865847.htm. 76. TRIPS Agreement, supra note 15, at Section 5. 88. Central Intelligence Agency, China World Factbook, 77. Eugster, supra note 19, at 146-47. https://www.cia.gov/library/publications/the-world-factbook/geos/ 78. Id. ch.html (last visited May 7, 2011). 79. 2011 Special 301 Report, supra note 8, at 32. 89. Id. 80. IACC, supra note 1, at 35-36. 90. Most Populated Cities in China, http://www.nationsonline. 81. Eugster, supra note 19, at 146-48. org/oneworld/china_cities.htm (last visited May 7, 2011). 82. Id. at 147 ( “[T]hough the numbers of raids have 91. IACC, supra note 1, at 37. increased over the past several years, the percentage of criminal 92. Id. penalties following these raids remains low.”). 93. Id. (noting that Russia and China underwent joint

American University Intellectual Property Brief 61 The Russian IPR Problem

commendable, but the tenuous relationship between the However, like Russia it does not have much stake in two nations over their shared border94 needs to evolve protecting its own IPRs.102 In fact, one of the problems into bilateral discussions regarding border security. caused by China’s stellar success has been a substantial Russia’s geographic size, combined with its border drop in Chinese exports, which for the first time in with China, certainly plays a role in its enforcement seven years were less than the percentage of imports.103 of IPRs. Emphasis should be placed on the fact that The steady drop in Chinese exports means that Chinese it shares an extremely large border with the leading companies are producing and exporting fewer goods, international infringer.95 While Russia can improve especially in the market of value added products.104 its customs procedures, the international community With a lack of value added products in the marketplace, must be realistic. Indeed, more international assistance China’s concern about the protection of its own IPRs is from the WTO and member nations would likely assist somewhat diminished. Russian in addressing its deficiencies at the Russian- Furthermore, China is the manufacturer and Chinese border. supplier of most of the world’s counterfeit goods.105 In B. Socioeconomic Factors: A Lack of Home this way, China’s economy provides a boon to the black market. Since much of China’s manufacturing and Grown Intellectual Property exports are not made by Chinese companies, but rather Although Russia and China are certainly world those of multinational corporations currently using economic powers, they both lack substantial and Chinese labor to create their products more cheaply,106 exportable goods for which they need IPR protections.96 China has less incentive to protect even their own IPRs Russia relies heavily on its vast reserve of natural because few of their own companies have an actual resources.97 Even then, its exports are primarily to the international presence. European Union (EU), China, Japan, and the U.S.98 Although Russia and China have drastically different Exports to the U.S., however, equal less than 7% of the economies and socioeconomic factors that influence total exports, which means that Russia is a very regional their views on protecting IPRs, comparisons can still be exporter.99 Although certain IPRs apply to natural made between them. Both countries share a common resource industries, particularly trademarks and possibly thread: neither has a strong international presence from some patents, Russian goods are not in high demand the IPR perspective. Russia is rich in natural resources around the world or even in Russia.100 but demand for Russian goods, music, art, literature, China, on the other hand, is a major manufacturer movies, and cars is low. Conversely, China produces and exporter, producing many of the world’s goods.101 everyone else’s goods, but has few of its own that demand IPR protection.107 Without national demand for stronger IPR protections, political incentives are Customs training on IPR in 2010). 94. See Li Xiaokun, supra note 87. low to make significant progress in protecting foreign 95. See 2011 Special 301 Report, supra note 8, at 19-20 intellectual property rights. (asserting that China is the leading international infringer). 96. China’s Export Growth Expected to Plummet, English .News.cn, (April 26, 2011, 10:26 AM), http://news.xinhuanet. com/english2010/china/2011-04/26/c_13846260.htm; Isabel Gorst, Russian exporters forced to drop grain prices, Financial Times (Jul. 4, 2011 6:14 PM), http://www.ft.com/cms/s/0/ac1314fa- a653-11e0-ae9c-00144feabdc0.html#axzz1b6MagWPd; Richard Higgs, Russian resin exports drop as domestic demand rises, Plastics News.com (Sept. 26, 2011) http://plasticsnews.com/china/english/ headlines2.html?id=1316810206; Russian oil production increases 1.23% in three quarters, exports drop, RIA Novosti (Oct. 3, 2011 (finding that China had more than 1.1 trillion in exports in 2010). 13:19 PM), http://en.rian.ru/business/20111003/167338551.html; 102. See China’s Export Growth Expected to Plummet, English Russia Metals Report Q4 2011, Business Monitor International News, (April 26, 2011, 10:26 AM), http://news.xinhuanet.com/ (Oct. 7, 2011), http://www.marketresearch.com/Business-Monitor- english2010/china/2011-04/26/c_13846260.htm (with the lack of International-v304/Russia-Metals-Q4-6620001/. Chinese goods in the marketplace, there will be fewer infringers of 97. U.S. Dep’t of State, Background Note: Russia, http:// Chinese goods). www.state.gov/r/pa/ei/bgn/3183.htm (last visited May 7, 2011). 103. See id. (finding that Chinese exports were predicted to 98. Id. drop to 20% in 2011). 99. Id. 104. See id. 100. Mikhail Khmelev, Russian Economy Has Little Hope of 105. See IACC, supra note 1, at 9. Becoming Competitive, RIANovosti (Jan. 5, 2007, 2:17 PM), 106. See U.S. Dep’t of State, supra note 101 (concluding http://en.rian.ru/analysis/20070501/64714338.html. that “China has become a preferred destination for the relocation of 101. U.S. Dep’t of State, Background Note: China, http:// global manufacturing facilities”). www.state.gov/r/pa/ei/bgn/18902.htm (last visited May 7, 2011) 107. See 2011 Special 301 Report, supra note 8, at 19.

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C. Political Corruption: The Biggest Barrier to counterfeit market. Without the support of the courts Progress and, specifically the judges, enforcement agents will simply be spinning their wheels. It is no secret that both Russian and China suffer 108 Similarly, Chinese corruption is a significant from political corruption. According to Transparency 119 International, an international corruption watchdog, impediment to effective IPR enforcement. A 2007 Russia and China both struggle with corruption.109 report from the Carnegie Endowment for International Considering that piracy and counterfeiting thrive in a Peace found that “endemic corruption among Chinese corrupt environment, the effects of political corruption officials poses one of the most serious threats to the likely impact IPR enforcement to some degree.110 nation’s future economic and political stability.”120 Russia is among the top 20% of most corrupt Despite public commitments to IPR protections, 111 nations. In 2005, the Organization for Economic increased raids, and fundamental changes to the judicial Cooperation and Development stated that, “[t]he system,121 71% of respondents to a research survey felt weakness, inefficiency and corruption of all branches of that IPR enforcement stayed the same or deteriorated government are the most important obstacles to further over the past year.122 One of the many explanations progress in reforming Russia.”112 Bribing government officials has not just become a problem in the Russian for these sentiments is that political corruption is still Federation, but a way of life, and is often a determining keeping counterfeiters out of court and keeping the laws 123 factor as to whether a case is prosecuted.113 Government unreasonably lenient. corruption remains a significant obstacle to combating Clearly, both countries struggle with political counterfeiting and piracy.114 corruption and dealing with it has become a way of life In 2009, President Medvedev stated that the Russian for companies doing business within their borders.124 Federation had only just begun creating a judicial system In Russia, the corruption is certainly a large part of the 115 that was free of corruption. With a judicial and problem in regulating and enforcing IPRs and must regulatory system burdened with heavy corruption and 116 be addressed. If Russia is ever going to crack down on a severe lack of transparency, it is not surprising that counterfeiters, its government officials need to be willing Russia has become a prominent market for counterfeit to stop the endemic corruption that plagues the country. goods.117 It appears that those calling for more criminal prosecutions against perpetrators of IPRs have identified D. Practical Solutions: WTO Accession & legitimate concerns with this system.118 This situation Border Enforcement also explains why the increase in raids and enforcement The first step in helping Russia in its quest to actions has had little effect in Russia’s multibillion-dollar improve the country’s treatment of IPRs is to allow them to join the WTO. Russian officials have already 108. See Corruption Perceptions Index 2010 Results, made public statements regarding their waning patience Transparency International, http://www.transparency.org/ as they still wait to be accepted into the World Trade policy_research/surveys_indices/cpi/2010/results (last visited May Organization.125 Russia has been waiting for approval 9, 2011). 109. See id. 110. Compare Corruption Perceptions Index 2010 Results, 119. See Embassy of the United States Beijing China, supra note 108, with 2011 Special 301 Report, supra note 8, at 19- Intellectual Property Rights, http://beijing.usembassy-china.org.cn/ 42 (of the 41 countries listed on the Trade Representatives’ Priority protecting_ipr.html (last visited May 10, 2011). Watch List and Watch List, only 11 had a corruption rating above 120. Minxin Pei, Policy Brief No. 55: Corruption Threatens 5 (on a scale of 10), 14 had a rating between 3 and 4, and 15 had China’s Future, The Carnegie endowment, (Oct. 2007) available rating of under 3). at http://www.carnegieendowment.org/publications/index. 111. See id. cfm?fa=view&id=19628. 112. Stephen Lee Myers, Pervasive Corruption in Russia Is 121. See Lack of IPR Enforcement Key Concern, The Global ‘Just Called Business’, N.Y. Times, Aug.13, 2005, www.nytimes. Times (Jan. 21, 2011), http://business.globaltimes.cn/china- com/2005/08/13/international/europe/13russia.html. economy/2011-01/615048.html; see also 2011 Special 301 113. See id. Report, supra note 8, at 19-21. 114. See Jim Nichol, Cong. Research Serv., RL 33407, 122. Id. (results based on the answers of 364 companies Russian Political, Economic and Security Issues and U.S. surveyed). Interests 21 (2011). 123. See 2011 Special 301 Report, supra note 8, at 21 115. See id. at 6. (finding that “[h]igh thresholds for initiating criminal actions have 116. See 2011 Index of Economic Freedom, The Heritage always been a significant barrier to effective enforcement against the Foundation, http://www.heritage.org/index/Country/Russia (last sale of counterfeits”). visited Oct. 18, 2011). 124. See Myers, supra note 110; Pei, supra note 120. 117. See IACC, supra note 1, at 35-36. 125. See Doubts Grow on Russia’s WTO Plans, BBC News 118. See Eugster, supra note 19, at 147. (Aug. 26, 2008), http://news.bbc.co.uk/2/hi/7582079.stm.

American University Intellectual Property Brief 63 The Russian IPR Problem

for almost 20 years.126 Furthermore, since they are Russia still wants to be a part of the WTO, bringing not a member nation, the penalties, sanctions, and them into the world community could motivate them discussions of the WTO mean little and have less to make significant changes. At the very least, accession bite. The U.S. has been a primary objector to Russian into the WTO would provide an environment for accession to the WTO over the past decade,127 but continued discussions, and the U.S. loses nothing if this policy may have been misguided. Indeed, Russian accession has little effect on the treatment of IPRs. membership in the WTO will likely benefit the U.S., The second step in improving Russia’s treatment and it might be be in its best interest to clear a path of IPRs is to facilitate immediate bilateral discussions for Russia. Once Russia joins, the U.S. will have the between Russia and China regarding their massive cooperation of other member nations in working with shared border. Both nations need to get serious Russia to improve IPR protection. about addressing the border enforcement problem Accession into the WTO will likely have little both nations face. For the most part, Russia is not immediate effect on Russia’s treatment of IPRs. producing or manufacturing counterfeit goods.134 However, once it becomes a member of the WTO, However, Russia is a fertile market for black market and other nations can help Russia can start the slow, counterfeit goods.135 Russia’s “border control problems arduous process of cleaning up its treatment of IPRs exacerbate the domestic availability of counterfeit just like they have with China. China came to the goods manufactured in neighboring countries” and WTO in 2001128 and since then has remained of the sold in their markets, kiosks, and stores.136 Russia leading infringers of U.S. IPRs.129 In 2007, the U.S. needs to clamp down on the border and stop the influx began an action with the WTO where it claimed of counterfeit goods. Without consistent sources of that China’s criminal thresholds were insufficient in counterfeit goods, prices for such goods would increase, cases of willful infringement of IPRs.130 The U.S. also shrinking the market. claimed that China was not properly disposing of However, Russia faces significant challenges if seized counterfeit goods nor were they meeting their forced to face the border problem alone. Having an obligations under TRIPS by denying copyrights and actual impact on the flood of counterfeit goods coming other related rights to authors whose works were not into the country requires bilateral efforts from China. authorized for publication in China.131 Considering The WTO has already concluded that China has a these allegations, the panel concluded that China had significant problem with its customs procedures.137 violated multiple provisions of the TRIPS agreement.132 Russia cannot make progress with regard to its border Since then, there has been improvement in China’s unless China makes similar efforts on its side of the attempts to comply with WTO obligations and panel border. A united effort would go a long way to curb recommendations.133 the rampant smuggling of counterfeit goods across If Russia were a member of the WTO, the United the Russian-Chinese border. Once Russia and China States could initiate a similar action, which would implement measures at the border, they could target hopefully begin the slow process of improving Russia’s the sources of counterfeit goods rather than collecting treatment of IPRs. Denying Russia’s accession simply them once the goods have already been disseminated preserves the status quo and does nothing to motivate for public consumption. Russia to improve the current environment. Since IV. Conclusion

126. See Eugster, supra note 19, at 150. Russia is a world power whose economic viability 127. See id. at 132 (“Until 2006, any legitimate attempts by depends on its ability to present itself as a stable and Russia to join the WTO were blocked by the United States.”). safe market for international businesses. Currently, 128. World Trade Organization, Members and Observers, Russia’s failures in the protection and regulation http://www.wto.org/english/ of IPRs are a large concern for most international thewto_e/whatis_e/tif_e/org6_e.htm (last visited May 11, 2011). businesses. For most companies, their ability to secure 129. See Office of the U.S. Trade Representative, supra and protect their own IPRs is essential to remaining note 8, at 20. competitive in the market. Becoming a member of 130. World Trade Organization, China—Measures Affecting the Protection and Enforcement of Intellectual Property Rights , (2009), 134. See IACC, supra note 1, at 35-36 (pointing out that the http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds362_e.htm main concerns with Russia relate to importation of a trafficking in (select link entitled “Panel Report” circulated on 26 January 2009). counterfeit goods, rather than production). 131. Id. at 2-3. 135. Id. 132. Id. at 134. 136. Id. 133. See Office of the U.S. Trade Representative, supra 137. World Trade Organization, China—Measures note 8, at 19 (monitoring various Chinese campaigns and programs Affecting the Protection and Enforcement of Intellectual designed to improve China’s commitment to WTO obligations). Property Rights, supra note 128, at 134.

64 Fall 2011 Joshua M. Green the WTO would benefit Russia enormously through a renewed sense of economic stability and would help to attract international business. Although membership in the organization will not have any immediate effect on Russia’s IPR problem, it will provide nations with a forum for bilateral discussions and make Russia part of the WTO’s dispute resolution system, which is starting to have an impact on China, ten years after their accession. Russia’s membership in the WTO is a necessary first step to establishing a consistent dialogue regarding their treatment of IPRs. With membership come the obligations of TRIPS and the dispute resolution system, which are part of membership with the WTO. While Russia has much to do in the way of enforcement of its IP laws, the laws themselves are sound and comply with the standards established in the TRIPS Agreement. Membership in the WTO could help lead Russia to better enforcement. Moreover, Russia shares one of the largest borders in the world with a top international infringer of intellectual property. Addressing the Russian-Chinese border is necessary. The fact that a large percentage of consumer goods sold in Russia are counterfeit goods and the fact that China is the largest manufacturer and supplier of pirated products is not an ideal combination. In order to make any kind of impact, Russia and China need to start immediate bilateral discussions on how to address the border problem. If both nations can find a way to limit the amount of counterfeit goods being smuggled into Russia, the world community could see significant changes in Russia. Improving protections of IPRs will help Russia become a more attractive market for international business. Russian projects and industry will also see an influx of foreign investment in their businesses, which will hopefully help Russia develop their own homegrown intellectual property. With its national IPRs at stake, the government will have more pressure and be more invested in making sure adequate protections are in place. In the end, Russian progress will be like a matryoshka doll. Right now the problems are big and gaudy, but as you remove each layer, the problems become smaller and smaller. Russia is one big IPR matryoshka doll, yet with time and international cooperation, the problems it faces can slowly be solved, layer by layer.

American University Intellectual Property Brief 65 Largest Copyright Infringement in History: Five US Universities Sued for Copyright Infringement by Alexandra Mackey

The following blog post was published on www.ipbrief.net on October 3, 2011.

On September 12, the Authors Guild, the copyrighted material is not infringement. Among these Australian Society of Authors, the Union Des fair uses are “teaching (including multiple copies for Ecrivaines et des Ecrivains Quebecois, and eight classroom use), scholarship, or research.” However, the individual authors filed a lawsuit against five United University of Michigan is not hiding behind the fair States universities. The defendants include the use doctrine just yet and has been quick to respond University of Michigan, the University of California, to the claim. Four days after the lawsuit was filed the the University of Wisconsin, Indiana University, University of Michigan released a statement that it Cornell University, and will suspend the digitalization of HathiTrust. HathiTrust is 163 books until it reexamines its a partnership formed by the procedures to ensure that copyright named universities and other holders are being notified that their research institutions and works are going digital. libraries. Founded in 2008, The lawsuit against the HathiTrust’s mission is to “to universities is closely related to contribute to the common a six-year lawsuit between the good by collecting, organizing, Authors Guild, the Association of preserving, communicating, American Publishers, other writers and sharing the record of and publishers, and Google. In human knowledge.” In 2005, the Authors Guild and the order to achieve this mission, Association of American Publishers HathiTrust has built a digital sued Google for scanning millions archive of library materials of books into its Google Books and contains millions of site. Back in March of 2011, U.S. copyrighted and public District Judge Denny Chin rejected domain books scanned by the Google’s settlement offer of $125 universities, Microsoft, and million. Currently, the lawyers Google. for the writers and publishers are The writers and publishers still in negotiations with Google claim their books have been but have agreed to move toward copied into digital form by HathiTrust, Google, and trial. Judge Chin recommended that Google adopt a others without authorization. The lawsuit charges strategy where writers and publishers grant permission the universities with “engaging in one of the largest to have their books turned into digital form rather than copyright infringements in history.” a system where the books are scanned unless the author The lawsuit centers around HathiTrust’s or publisher objects. Personally, an opt-in system seems dissemination of digitalized “orphan works”, or works to keep the rights with the copyright holder as opposed whose copyrights holder could not be located. In June, to an opt-out strategy. HathiTrust and the University of Michigan announced There is no doubt that book digitalization has a plan to provide these orphan works in full-text digital great benefits, such as immediate access to research form. materials and preservation of out-of-print works. The universities have defended their actions Both HathiTrust and Google once had aspirations of publicly by claiming that their conduct is allowed owning the largest digital library, but it looks like they under Section 107 of the United States Copyright Act. may have to answer to writers and publishers before Section 107, otherwise known as the fair use doctrine, achieving that dream. enumerates various purposes for which the use of the

66 Fall 2011 Top 1% Files for Trademark of “Occupy Wall Street” by Seth Dennis The following blog post was published on www.ipbrief.net on October 30, 2011. Several trademark applications for OCCUPY named as “The Ferraro-Eng Family Trust.” The names WALL STREET and OCCUPY WALL ST. have provided on the address refer to Vincent Ferraro and recently been filed with the USPTO. The first Wee Nah Eng. Interestingly enough, Ferraro, a Stanford application was mentioned in the news several days Business School grad, is the former Vice-President of earlier, but the subsequent applications are where Worldwide Marketing for Hewlett-Packard, where he this story gets interesting. For those that missed the met his wife Wee Nah Eng. Ferraro now serves as the story on the first application, the brief version is that Vice President and Chief Marketing Officer of Global an application was filed on October 18, 2011 by a Marketing for Eastman Kodak, and also appears to Long Island, NY couple, Diane and Robert Maresca. hold several consulting positions. Now, I don’t know Their application was for use of what type of compensation Ferraro OCCUPY WALL ST. on bags, receives, but based on his title, clothing, stickers, etc. Maresca position, and impressive (publicly asserted that he supports the accessible) Linkedin resume, I would movement, and that he filed for be willing to give anyone 10:1 odds the trademark as a preemptive that the Ferraro-Eng household move to keep somebody with less is bringing in enough to meet the pure motives from filing for the $380K a year threshold for the “top mark. Maresca also maintained 1%.” that his intentions were to have The irony would be palpable if the OWS supporters get the Ferraro-Eng actually intends to sell maximum benefit possible, the clothing, bags, footwear, etc. that after any expenses of course; the trademark application covers. If alternatively, Maresca said he this scenario were in a book or movie was willing to sell the OWS script it would probably be rejected mark to the groups’ members, for being too obvious – somebody provided they pay for his in the top 1% registers OCCUPY expenses in obtaining the mark. WALL STREET as a trademark so Perhaps Maresca does have good that they can make money off the intentions, but offering to sell a Image by Michael Thompson 99% that protests against them. mark belonging to a people’s movement back to those To be fair though, I do not know what the people smacks of hypocrisy. Ferraro-Engs’ motivations are in registering After this story appeared in the news it likely OCCUPY WALL STREET as a trademark, and I am triggered the two applications for the phrase OCCUPY not aware of either party being affiliated with any WALL STREET. Both applications were filed on particular political group. There are certainly those in October 24, 2011. One of the applications was filed by the top 1% who support OWS, and would like to see Pete Dutro and Victoria Sobel, two OWS organizers changes made in this country. It is entirely possible that have been maintaining the finances for the group. that the Ferrero-Engs intended to register the Their significant involvement in the movement is mark to either donate it to the group or to prevent demonstrative of their good intentions, and the move people like Maresca from attempting to exploit the was most likely to prevent people like Maresca from movement. I am personally hoping that is the case – trying to capitalize on OWS. that the Ferrero-Engs are in the top 1%, but have a The questionable part of this story comes from the mindset more akin to Bill Gates than to Steve Jobs. second application, filed by Fer-Eng Investments, LCC, Pending the outcome of the trademark applications, I an Arizona based corporation. Fer-Eng Investments guess we will find out soon enough. appears to be a shell corporation with the only officer

American University Intellectual Property Brief 67 Capturing Clouds Remitting the Remittal of Joel Tenenbaum’s Remittitur Motion by Jess Robinson

The following blog post was published on www.ipbrief.net on September 20, 2011. Recently, the First Circuit overruled the district First Circuit’s opinion leaves no room for doubt that court’s holding in Sony’s copyright infringement Tenenbaum is guilty of having willfully violated case against Joel Tenenbaum. The district court had copyright law, and it explains that Congress intended found Tenenbaum guilty on thirty counts, but it had for statutory damage awards to be so high that it reduced the jury’s verdict of $675,000 in statutory scares off potential infringers. Tenenbaum was caught damages to $67,500 because it was so excessive so as precisely in congressional crosshairs and the case to unconstitutionally violate due process. The First should be finished. Instead, by remanding the case Circuit agreed that Tenenbaum was guilty of the claims for remittitur and saying that it “raises concerns about against him, but application of it disagreed with the Copyright how the district Act,” the First court had denied Circuit implies his motion for that it agrees remittitur and $675,000 is too instead chose harsh a penalty to address a for illegally constitutional sharing thirty due process issue. copyrighted According to songs. the First Circuit, Even if it the doctrine of didn’t agree, the constitutional First Circuit avoidance should is extending have bound the the case’s district court proceedings and to consider all making it more nonconstitutional costly for Sony. grounds for It could also be reaching Image by Gaudencio Garcinuño more costly for a decision Tenenbaum, (including remittitur) before addressing any but I suspect his legal fees are less demanding than constitutional issues. Reinstating the jury’s verdict of Sony’s. On remand, Sony will have two options for $675,000, the First Circuit remanded the case with how to go forward, and pointing out the continued orders to consider Tenenbaum’s motion for remittitur. cost of litigation is relevant because it should factor Those in Tenenbaum’s camp might call this into its decision. Offered a remittitur, Sony can a “disappointing ruling,” and that’s certainly either accept it or push onward to a new trial for non- understandable when he’s put back on the hook downsized damages. Now that Sony has already shelled for more than half a million dollars. Nevertheless, out money to appeal the case, a cost-benefit analysis you can’t help but ask yourself why the First Circuit might push it to more seriously consider a remittitur, overruled a verdict of downsized damages only to especially when it also knows the district court remand it so the parties can consider . . . downsized thought the original verdict was so excessive so as to be damages. Maybe the First Circuit is only following unconstitutional. I say “should factor in” only because the rules and enforcing the doctrine of constitutional Sony could very well ignore a cost-benefit analysis and avoidance, but I think there’s more going on. The push for a new trial just to prove a point.

68 Fall 2011 The opinion implies the First Circuit thinks Sony will push for a new trial with high damages. Assuming it will, the First Circuit might have had a motive by vacating the verdict on due process grounds and ordering a remittitur. The way I see it, the district court only accomplished one thing by originally denying Tenenbaum’s motion for remittitur but then downsizing the verdict on other grounds: it bypassed other opportunities to downsize the damages award so that it could legislate from the bench. I think the First Circuit substantively agrees with the district court’s conclusion, and maybe even that the Copyright Act allows for unconstitutionally harsh punishments, but I think it would prefer the message to come from a jury. Under section 504(c) of the Copyright Act as codified in the U.S.C., the minimum damages allowed for thirty counts of copyright infringement is $22,500 ($45,000 less than the original downsized award). When there are so few copyright infringement cases like this that don’t settle, I can see a lowball jury award being a strong, democratic signal to Congress that something’s wrong with copyright infringement law.

American University Intellectual Property Brief 69 Informal Formalities To Patent or Not To Patent, That is The Question: Embryonic Stem Cell Patents Rejected in Europe by Amer Raja

The following blog post was published on www.ipbrief.net on October 29, 2011.

Recently, the European Court of Justice was The issues that the European Court of Justice was asked to determine the patentability of stem-cell asked to determine largely arose from the European products derived from human embryos. While the Union’s approach to patentability and embryonic question submitted to the Advocate General was not research. The relevant legislation and treaty language as straightforward, both the Advocate General and the can be found in the German national law, TRIPS Court seemed to have little trouble in taking a position article 27, CGEP articles 52(1) and 53, and Directive in this case. At the heart of this query was “whether 98/44 with respect to article 6(2)(c). Of these sources the human embryonic stem cells which serve as base of law, the Court particularly focused on the directive material for the patented processes constitute ‘embryos’ since the case turned on the definition of “embryo” and within the meaning the “dignity of Article 6(2)(c) of and integrity” the Directive.” The of a person. Court’s decision in The Court’s this case, therefore, decision also necessarily was largely addressed the centered on patentability of the concepts “embryonic base of ordre material” and public and subsequent lines morality that of products arising are included from base material. in the laws The dispute and treaties. arose from Mr. However, Oliver Brüstle’s since there patent on “isolated is some and purified neural question as precursor cells to whether produced from a stem cell human embryonic or purified stem cells used to precursor treat neurological cell could be diseases.” Mr. considered Brüstle works at to be an the University of embryo, Bonn in Germany as a Professor of Reconstructive the Court first attempted to define and interpret the Neurobiology. Greenpeace, along with a number concept of human embryo with respect to article 6(2) of religious organizations, contested the patent and (c). sued for “ethical reasons,” to invalidate Mr. Brüstle’s To give some context to the Court’s ruling, I ownership rights in the patent. The patent was will briefly outline a few relevant points in stem cell declared “invalid insofar as it covers precursor cells research. While there are a few different types of stem obtained from human embryonic stem cells,” by the cells, embryonic stem cells are probably the most Federal Patent Court (Bundespatentgericht), and the potent and controversial since production starts with case was subsequently referred to the European Court the fertilization of a human ovum (“egg”). Within a of Justice. few days after fertilization, a blastocyst is formed, which

70 Fall 2011 is comprised of a number of cells and regarded by a of embryonic stem cells.” number of scientists to be an early stage embryo. In As a result the Court’s decision may not really the interim period between fertilization and blastocyst do much at all in the way of discouraging stem cell formation, the ovum (now a “zygote”) undergoes a research – it may very well promote it. While in the number of changes. United States we have the Bayh-Dole act to promote These changes include the formation of totipotent non-commercial research which can later become cells (unspecialized cells which can form anything commercialized; embryonic stem cell products could in a human body) and eventually pluripotent cells very well start as non-commercial ventures in Europe (which can form a number of things but within one of and later lead to greater developments that may be three categories). Totipotent cells precede pluripotent nevertheless be patentable as well. The incentive in cells chronologically and denote different stages of obtaining a patent and conducting a research may development. Therefore, the issue the Court had to merely be delayed as opposed to entirely eliminated. wrestle with determining the moment at which an Furthermore, some practitioners have even posited embryo could be regarded to exist, since it would be the idea that researchers could depend on trade secrets protected by national law. and regulatory procedures to sidestep the hurdle. In the end, the Court determined that while the Lastly, the Court through its ruling has not foreclosed pluripotent cells and blastocyst are more specialized in all embryonic stem cell research as such. Scientists may the development of a human being, that totipotent cells still be able to patent embryonic stem cell products by were also necessarily included in the definition of an establishing that a stem cell obtained at the blastocyst embryo. The Court stated that “[A]ny human ovum should not be considered an embryo and therefore must, as soon as fertilised, be regarded as a ‘human could potentially be patentable subject matter. In sum, embryo’ within the meaning and for the purposes of the Court’s decision may provide very little guidance the application of Article 6(2)(c) of the Directive, since at all, and certainly leaves open the question of how that fertilisation is such as to commence the process of to implement this new restriction on patentability; development of a human being.” This definition is also it will certainly be interesting to see how scientists, meant to include traditionally and non-traditionally organizations, and Courts deal with this matter in the matured ova, such as in parthenogenesis (maturation coming months and years. of an ovum without fertilization). However, the Court seems to have left open the question of whether a stem cell obtained at the blastocyst stage is an embryo, which may lead to further debate in the field. In addition to its determination that an embryo exists once an ovum is fertilized, the Court determined that scientific research and industrial use of embryos cannot lead to patents and further excluded any materials obtained from the destruction or use of embryos as base material. While the implications of this decision are not entirely clear at this point, Mr. Brüstle and a number of other scientists have articulated that this decision comes as a huge blow to the scientific community. The scientists feel that this decision will serve as a huge setback in the development of stem cell products and may result in a greater advantage for their Asian counterparts. Greenpeace, the Catholic Church, and a number of religious organizations, however, feel that this decision comes as “a victory for human dignity.” However, Mr. Julian Hitchcock, a lawyer with Field Fisher Waterhouse LLP also voiced his opinion that this decision may not actually be too detrimental to stem cell research; it could very well provide scientists and researchers with more freedom to not “worry about infringing someone else’s patent.” Furthermore, he points out that “While the ruling restricts patentability of such inventions, it doesn’t in any way restrict the use

American University Intellectual Property Brief 71 American University Intellectual Property Brief